The Role of Engineering Design Methodologies for New Circular Business Models: A Sustainable Finance Challenge

Industrial engineering and product design are fundamentally related to the imperative sustainability requirements. Products create environmental problems throughout their life cycle in several ways: during the extraction and process of raw materials, during manufacturing, during transportation, use, and maintenance, and finally, during their disposal. Decisions taken at the engineering design stage are influencing more than 80% of the environmental and social impacts of a product, incurred throughout its whole lifecycle. Current research in this field focuses on the development and implementation of design for environment methodologies, life cycle analysis, and on circular economy (CE). Recently, sustainable finance has systematically taken into account environmental, social, and governance (ESG) considerations when making investment decisions in the financial sector, leading to more long-term investments in sustainable activities and projects. ESG considerations might include the environment more broadly, for instance, pollution prevention and CE. This paper aims to illustrate the connection of engineering design with the goals and opportunities offered by the sustainable finance perspective. The stage of development of a theoretical framework that efficiently links the above concepts by taking also into account the challenges imposed by CE is presented and discussed.