Innovation and Sustainability of the Business Models: From Experiences to Financial Impacts.

In the corporate context, the concept of innovation is increasingly combined with the concept of sustainability. In the past, the innovation-sustainability combination was not always conceived in a positive sense, as everything that had to comply with environmental and ecological needs required a path of almost “involution” of lifestyles, and the products had to be generally low-high-performance and made with recycled materials. Today, this vision has been replaced by an idea that focuses not only on a more attentive style of consumption but also on a new way of doing business, capable of balancing respect for the planet with the supply of high-quality products, “environmentally friendly” and capable of optimizing lifestyles, forcing businesses to transition from a classic linear model to a circular model. This is a very delicate and profound step that leads to the innovation of the companies’ business model. This innovative process generates and implies important changes in terms of financial flows and risk and requires the development of specific management skills. In the transition toward circular economy business models, it is important that companies include, estimate and exploit their value in terms of reducing costs and risks, increasing competitiveness and operational efficiency, better responding to demand from the market, reduction of stranded assets and improvement of long-term profitability. The chapter aims, on the one hand, to illustrate the financial benefits of circular economy business models in terms of performance, risks and cash flows of investments and the effects on fundamental financial dynamics, and on the other hand, to highlight, through the study of concrete experiences in Italy, the real operating methods of companies in a logic of continuous circular renewal.