Business model life cycle assessment: A method for analysing the environmental performance of business
Journal article, 2022

This paper introduces business model life cycle assessment (BM-LCA), a new method for quantifying the environmental impacts of business models. Such a method is needed to guide business decisions towards decoupling economic activity from environmental impact. BM-LCA takes the business model itself as the unit of analysis and its economic performance as the basis of comparison. It can be applied to any type of business model involving material or resource use. In BM-LCA, monetary flows are coupled to material and energy flows. The methodology expands on conventional life cycle assessment (LCA) by elaborating the goal and scope definition and dividing it into two phases. The first descriptive phase details the business models to be compared. It includes a mapping of product chain actors and identifying business operations and transactions related to the product. The second coupling phase defines a profit-based functional unit and sets up the coupling equations expressing the economic relations to the product. Thereafter, conventional LCA procedures are followed to assess environmental impacts. The key innovation on LCA methodology is the development of a functional unit that captures the economic performance of a business model and links it to a product system. BM-LCA provides thus an important link between LCA and business competitive advantage.

decoupling

sustainable production and consumption

functional unit

Life Cycle Assessment

Business models

method

Author

Daniel Böckin

Chalmers, Technology Management and Economics, Environmental Systems Analysis

Giulia Goffetti

University of Siena

Henrikke Baumann

Chalmers, Technology Management and Economics, Environmental Systems Analysis

Anne-Marie Tillman

Chalmers, Technology Management and Economics, Environmental Systems Analysis

Thomas Zobel

Luleå University of Technology

Sustainable Production and Consumption

2352-5509 (eISSN)

Vol. 32 112-124

TwinWins: Measuring business model environmental performance

Kamprad Family Foundation, 2024-03-31 -- 2027-03-31.

Mistra REES (Resource-effective and efficient solutions) phase 2

The Swedish Foundation for Strategic Environmental Research (Mistra) (2019-00239), 2019-12-01 -- 2023-12-31.

Circularis

VINNOVA (2016-03267), 2016-10-01 -- 2019-09-30.

Driving Forces

Sustainable development

Areas of Advance

Production

Subject Categories

Other Environmental Engineering

Environmental Management

Business Administration

DOI

10.1016/j.spc.2022.04.014

More information

Latest update

5/3/2024 1