Democratizing the Circular Economy: Digital Platform Strategies for Fostering Participatory and Equitable Ecosystems for Small and Medium Enterprises (with a Case Study of Iran)

The circular economy is recognized as a key pillar of sustainable development, but its implementation is often dominated by large companies which have the capital and logistical capacity to reengineer their supply chains. However, small and medium-sized enterprises (SMEs), despite being the engines of local economies, face significant barriers to participation in the circular economy, including lack of information, high transaction costs, limited networks, and in contexts such as Iran, additional challenges stemming from economic sanctions and institutional instability. This paper addresses the crucial issue of how to harness the potential of digital transformation to overcome these barriers. The main research question is: What are the key functions and strategic designs of digital platforms that enable SMEs to collaborate and create value in circular economy ecosystems, thereby promoting environmental sustainability and economic justice? This study provides an in-depth analysis, identifying and theorizing the critical role of “digital intermediaries of the circular economy” as key enablers of SMEs. Using a grounded theory approach and exploratory case studies (focusing on the Iranian context), this paper develops a typology of essential platform functions, including resource matching, trust building and verification, logistics and transaction facilitation, and knowledge creation and community building. The expected findings suggest that these digital strategies not only drastically reduce entry barriers, but also enable previously unimaginable industrial symbiotic networks and contribute to more equitable and distributed value creation in regional economies. This research argues that digital transformation is a key enabler for expanding the scale of the circular economy beyond large companies, and that by focusing on empowering small and medium-sized enterprises to collaborate, more resilient, local, and equitable economic systems can be created, especially in developing and stressed economies like Iran.