Decolonising Business Strategy in the Circular Economy: Knowledge Asymmetry, Informal Sector Integration and Firm‐Level Outcomes

ABSTRACT This paper advances the circular economy (CE) strategy by conceptualising epistemic misalignment as a structural constraint on circular performance in emerging economies. Although CE governance increasingly relies on globally codified metrics and ESG reporting tools, such instruments often fail to capture locally embedded recovery infrastructures in contexts characterised by institutional heterogeneity. Using Nigeria's plastics recovery landscape as an analytical lens, the study introduces the construct of knowledge asymmetry to explain how distorted knowledge integration generates strategic blind spots, operational inefficiencies and legitimacy risks. Integrating decolonial political economy with the Knowledge‐Based View and dynamic capabilities theory, the paper reconceptualises informal sector integration (ISI) as a dynamic capability that enhances circular performance and mitigates the adverse effects of knowledge asymmetry. The framework further specifies ethical governance and institutional integrity as boundary conditions shaping integration outcomes. By reframing CE transitions as knowledge governance challenges, the study contributes a decolonised strategic perspective on sustainability transitions in Global South supply chains.