From Suspicion to Sustainability in Global Supply Chains (original) (raw)

The Role of Precontractual Signals in Creating Sustainable Global Supply Chains

Journal of Business Ethics, 2018

Global supply chains enhance value, but are subject to governance problems and encourage evasive practices that deter sustainability, especially in developing countries. This article proposes that the precontractual environment, where parties are interested in trade but have not yet negotiated formal terms, can enable a unique process for building long-term sustainable relations. We argue that precontractual signals based on relation-specific investments, promises of repeated exchange, and reassuring cheap talk can be leveraged in precontract by the power of framing. We show how these framing signals are amplified in precontract because the lack of credible information, minimal time for reflection, and the role of risk-aversion present in supply chain contract negotiations. The result is a process that is uniquely productive for building long-term and valuegenerating contractual relations in supply chains, particularly in skeptical or even hostile negotiating contexts. We then show how framed precontractual signals generate a joint contractual surplus through a supernormal profit known as a relational rent. This rent can be invested to improve sustainable practices, an efficient option in a competitive market due to the second order effects that sustainable practices generate. This novel process we propose thus potentially generates superior returns to other trust measures and encourages focus on precontract as a fertile environment for building sustainable investments. Keywords Sustainability • Global supply chains • Precontract • Framing • Developing countries Sustainability is an important component of multi-tier global supply chains (Levy et al. 2015). 1 There is evidence that sustainable supply chains improve product quality (Van der Vorst et al. 2009), unlock new markets (Hassini et al. 2012), increase consumer engagement (Linton et al. 2007), and deliver superior economic performance (Rao and Holt 2005). Sustainability in global supply chains is also of pressing social importance, impacting the health, safety, human rights, and economic development of workers (Maloni and Brown 2006). Sustainable practices also influence important environmental challenges such as climate change, pollution, and hyper-exploitation of non-renewable resources (Linton et al. 2007). As a result, a growing literature has emerged

Social sustainability in supply chains: the role of local practices and informal networks

International Journal of Physical Distribution & Logistics Management, 2022

Purpose-The study aims to investigate cultural aspects in supply chains, analysing the effect that local customs may have in the quality of buyer-supplier relationships. Building on the premisses of social exchange theory (SET), it concentrates on the impacts that suppliers' use of local practices and informal networks may have in buyers' attitudes and perceptions. The issues addressed and the empirical evidence provided represent initial, yet important steps in the fulfilment of the 'cultural void' within supply chain social sustainability (SCCS) literature. Design/methodology/approach-Through a role-playing experiment applied to a total sample of 468 participants, the effects of Chinese guanxi, Russian blat, South Korean yongo and Brazilian jeitinho on buyers' satisfaction, buyers' commitment, trust and solution severity are measured by their use to access informal networks as solutions to both common (i.e. documentation irregularities) and extraordinary (i.e. modern slavery) supply chain problems. Findings-Results show that, while the activation of informal networks may impact buyers' perceptions, the use of some local practices by suppliers (i.e. Chinese guanxi and Brazilian jeitinho) cause greater variations in buyers' attitudes and perceptions than others (i.e. South Korean yongo and Russian blat), with ethical offences (i.e. modern slavery) and higher levels of buyers' dependency acting as catalysts of these processes. Originality/value-The investigation of cultural practices typical of economically peripheral countries contributes to the understanding of new facets of buyer-supplier relationships, with the investigation of non-Northwestern practices being particularly important in this regard.

GLOBAL SUPPLY CHAINS AND THE SUSTAINABLE DEVELOPMENT.pdf

CBU INTERNATIONAL CONFERENCE ON INNOVATIONS IN SCIENCE AND EDUCATION, 2017

Sustainable development issues are considerably popular subjects within the international research community. On the other hand the importance of the issues related to global supply chains has also increased significantly. This paper will also mention a change in one of the main economic paradigms: from international exchange between countries and individual companies there is a transition to exchange between the participants along the global supply chains. The interest in global supply chains and their management is provoked by the fact that they are a major source of competitive advantage on global markets. Nowadays, global supply chains are an integral part of the activities of a number of companies operating abroad. Every business operation finds its place in one or more supply chains. Within the contemporary context of scarce resources and the widely spread sustainable development idea, the companies compete on a global economic scale where the main business unit is the world as a whole, not an individual country or region. All these trends and global developments provoked our scientific interest and with the project “Corporate governance and the global supply chains” we tried to find out how the global supply chains are actually influenced by the issues of sustainable development. Within the course of the project we have reviewed and analyzed quite a lot of scientific literature, we studied the publicly available information of the big international corporations related to their social corporate responsibility and sustainable development issues. In addition, we have made empirical research among local suppliers of big international companies as well as a number of international NGOs dealing with sustainable development and social policy issues. Some of the findings from our project are presented in the current paper.

Efficiency meets responsibility: configuring an accountable and responsible supply chain

The public increasingly holds firms accountable for social and environmental outcomes, such as product toxicity problems and human rights violations, throughout their global supply chains. How can companies improve the social and environmental performance within their supply chains, particularly as other competitive pressures, such as cost and quality, continue to escalate? Starting from an efficient versus responsive supply chain framework, we develop an integrative model that blends together elements of supply chain configuration, stakeholder management, and capability development. Specifically, we spotlight the dimensions of control and accountability that collectively determine stakeholder exposure, and show how this new construct affects the linkages between supply chain capabilities, configuration, and performance. In particular, this analysis reveals that the nature of stakeholder exposure determines how social/environmental technical and relational capabilities impact social and environmental outcomes. We conclude with implications for research and practice, discussing how current supply chain theories must be extended to incorporate external stakeholders, to clarify strategies and identify potential pitfalls, and to better predict performance outcomes.

Global Supply Chains and the Sustainable Development

CBU International Conference Proceedings

Sustainable development issues are considerably popular subjects within the international research community. On the other hand the importance of the issues related to global supply chains has also increased significantly. This paper will also mention a change in one of the main economic paradigms: from international exchange between countries and individual companies there is a transition to exchange between the participants along the global supply chains. The interest in global supply chains and their management is provoked by the fact that they are a major source of competitive advantage on global markets. Nowadays, global supply chains are an integral part of the activities of a number of companies operating abroad. Every business operation finds its place in one or more supply chains. Within the contemporary context of scarce resources and the widely spread sustainable development idea, the companies compete on a global economic scale where the main business unit is the world as a whole, not an individual country or region. All these trends and global developments provoked our scientific interest and with the project "Corporate governance and the global supply chains" we tried to find out how the global supply chains are actually influenced by the issues of sustainable development. Within the course of the project we have reviewed and analyzed quite a lot of scientific literature, we studied the publicly available information of the big international corporations related to their social corporate responsibility and sustainable development issues. In addition, we have made empirical research among local suppliers of big international companies as well as a number of international NGOs dealing with sustainable development and social policy issues. Some of the findings from our project are presented in the current paper.

Sustainable global supply chains: from transparency to due diligence

Sustainable Trade, Investment and Finance, 2019

'responsibly managed' supply chain. There are very few of the SDGs that are not affected by business activity. Supply chain activity, in particular, has an equal opportunity to push the UN development agenda both forward and backward. Considering the most common complaints against poorly managed supply chains and the human rights abuses resulting therefrom, it seems clear that sustainable 7 The Institute for Human Rights and Business (IHRB) uses the terms interchangeably, see Sune Skadegaard Thorsen, 'Are Current Approaches to Responsible Supply Chain Management Working?' (IHRB, 12 August 2010) https://www.ihrb.org/focusareas/commodities/commentary-current-approaches-responsible-supply-chain-management-working accessed 25 May 2018; Robert Strand, R Edward Freeman and Kai Hockerts, 'Corporate Social Responsibility and Sustainability in Scandinavia: An Overview' (2015) 127 Journal of Business Ethics 1, 2. Strand et al suggest that 'sustainability' is, in some instances, increasingly preferred over CSR while others note that the term's use is dependent on the field. See Kate Fitch, 'Public Relations and Responsible Citizenship: Communicating CSR and Sustainability' in Martin Brueckner, Rochelle Spencer and Megan Paull (eds), Disciplining the Undisciplined? CSR Sustainability, Ethics & Governance (Springer 2018) 112 et seq. 8 This is done for purposes of simplicity noting that the focus of this chapter is not to define the concept but to generate views as to how sustainability is achieved.

Sustainable and responsible supply chain governance: challenges and opportunities

This paper introduces the Special Volume on sustainable and responsible supply chain governance. As globalized supply chains cross multiple regulatory borders, the firms involved in these chains come under increasing pressure from consumers, NGOs and governments to accept responsibility for social and environmental matters beyond their immediate organizational boundaries. Governance arrangements for global supply chains are therefore increasingly faced with sustainability requirements of production and consumption. Our primary objectives for this introductory paper are to explore the governance challenges that globalized supply chains and networks face in becoming sustainable and responsible, and thence to identify opportunities for promoting sustainable and responsible governance. In doing so, we draw on 16 articles published in this Special Volume of the Journal of Cleaner Production as well as upon the broader sustainable supply chain governance literature. We argue that the border-crossing nature of global supply chains comes with six major challenges (or gaps) in sustainability governance and that firms and others attempt to address these using a range of tools including eco-labels, codes of conduct, auditing procedures, product information systems, procurement guidelines, and eco-branding. However, these tools are not sufficient, by themselves, to bridge the geographical, informational, communication, compliance, power and legitimacy gaps that challenge sustainable global chains. What else is required? The articles in this Special Volume suggest that coalition and institution building on a broader scale is essential through, for example, the development of inclusive multi-stakeholder coalitions; flexibility to adapt global governance arrangements to local social and ecological contexts of production and consumption; supplementing effective monitoring and enforcement mechanisms with education and other programs to build compliance capacity; and integration of reflexive learning to improve governance arrangements over time.

Conceptualizing sustainable development and global supply chains

Ecological Economics, 2012

This paper introduces a holistic approach to the study of sustainable development of global product chains. We first present a number of perspectives on this topic from disciplines such as economic geography, management science, sociology and environmental sciences. Each of these approaches brings in a specific focus: the consequences of geographical dispersion of economic activities, measurement of ecological and social impact, managing sustainability in supply chains, and power asymmetry among economic actors. Until now, these disciplinary research lines have remained unconnected. We argue that ecological economics provides a promising background for a more holistic conceptualization. To this end, we formulate five basic questions that serve to advance the study of sustainability throughout the product chain by connecting the foci of the identified scientific disciplines. The aim of advancing a holistic perspective has guided the selection of papers for this special subsection, which are introduced throughout the text.