Industry 4.0 Quasi-effect Between Circular Economy And Sustainability: Palm Oil Industry

Abstract

Palm oil supply chains are complex and controversial due to claims that they follow unsustainable practices in operation and production process, which causes massive environmental pollution. However, this claim is not strong enough to generalize the whole industry as unsustainable. Indeed, the palm oil industry seems to be pursuing Industry-4.0-technologies and circular-economy-practices to improve its unsustainable practices. This study endeavours to overcome the shortcomings in the palm oil industry that is fragmented and unclear. This study develops a structural literature review published in 2011–2021. This study presents a conceptualization framework through four cluster groups (1) industry-4.0-in-a-circular-economy application; (2) sustainability practices; (3) sustainability performance; and (4) moderating factors. Subsequently, the present study develops nine propositions from these concepts due to descriptive and content analyses. Then, the study theorizes that industry-4.0-in-a-circular-economy application has a quasi-effect on sustainability performance, and sustainability practices may act as a mediator in this relationship and a moderating factor that may influence the above relationship. This study contributes to both theory and practice by advancing the current understanding of industry-4.0-in-a-circular-economy application in the POI, especially its impact on sustainability practices and performance.