Circular Economy Policies, Global Value Chains, and the Future of International Business: Insights from the French Textile Industry

This chapter examines how emerging circular economy (CE) policies are reshaping the global strategies of multinational enterprises (MNEs), with a focus on the French textile industry. While international business (IB) research has engaged widely with sustainability issues, it has only recently begun to explore the implications of CE for global value chains (GVCs) and business model transformation. Drawing on qualitative interviews with key stakeholders, we investigate how firms navigate the shifting regulatory environment introduced by French policies that seek to support circularity. Our analysis highlights how CE policymaking affects multiple stages of the textile GVC – from raw material sourcing and eco-design to reverse logistics and end-of-life product management – posing significant challenges to the volume-driven, globalized business models of clothing MNEs. Findings suggest that the strategic adaptations of French firms are shaped by industrial legacies, cost structures, and anticipation of upcoming EU policies and regulations. While some MNEs invest in circular initiatives as a source of long-term strategic advantage and market differentiation, others are skeptical, particularly regarding the scalability of eco-design in mass-market segments. The chapter concludes by identifying key research gaps and calling for greater interdisciplinary dialogue between CE, IB, and GVC scholarship to better understand the evolving geography of global production under circular imperatives.