Circular economy challenges under uncertainty in the Indonesian fashion industry: A causal hierarchical model

Abstract

This study provides insights into the circular economy challenges in the Indonesian fashion industry and builds a hierarchical model under causality relations among the proposed challenges’ attributes. However, the Indonesian fashion industry imposes many challenges in addressing environmental and social concerns. This study aims to assess the partition challenges of the fashion industry to establish a new approach to developing a hierarchical model. A hybrid methodology is proposed. (1) The fuzzy Delphi method is used to establish a valid set of circular economy challenges; (2) the fuzzy decision-making test and evaluation laboratory are used to assess the causal relationships among the different attributes to determine the challenges; and (3) the analytic network process can assess hierarchical interdependencies among the attributes. The results show that waste management barriers and standard and regulation challenges are the main causal attributes. The challenges in the Indonesian fashion industry include inadequate waste management infrastructure, a lack of regulatory pressure on waste management, unstandardized circular economy measurements and the high dependability on third-party waste pickers.