To fight climate change, firms must adopt effective and feasible carbon management practices that promote collaboration within supply chains. Engaging suppliers and customers on carbon management reduces vulnerability to climate-related risks and increases resilience and adaptability in supply chains. Therefore, it is important to understand the motives and preconditions for pursuing supply chain engagement from companies that actively engage with supply chain members in carbon management. In this study, a relational view is applied to operationalize the supply chain engagement concept (...) to reflect the different levels of supplier and customer engagement. Based on a sample of 345 companies from the Carbon Disclosure Project’s supply chain program, the determinants of engagement were hypothesized and tested using multinomial and ordinal logistic estimation methods. The results indicate that companies that integrate climate change into their strategies and are involved in developing environmental public policy are driven by moral motives to engage their suppliers and customers in carbon management. All these factors make a stronger impact on supplier engagement than on customer engagement. Moreover, companies operating in greenhouse gas-intensive industries are driven by instrumental motives to engage their suppliers and customers because increasing greenhouse gas intensity positively influences engagement level. Company profitability appears to increase supplier engagement, but not customer engagement. Interestingly, operating in a country with stringent environmental regulations does not appear to influence supply chain engagement. By utilizing relational capabilities and collaboration, buyers can increase their suppliers’ engagement to disclose emissions, which ultimately will lead to better results in carbon management. (shrink)

Multinational enterprises dominate the governance of global value chains, such that according to the concept of political corporate social responsibility, they are responsible to address governance gaps throughout the chains, even at the level of their independent suppliers. In practice, MNEs often struggle to cope with the complexity of these governance gaps, and PCSR does not provide a clear definition nor offer guidance for how to analyze and address them. By adopting the notion of governance mechanisms from GVC literature, this (...) study proposes a more nuanced view, in which governance gaps result from inactive, ineffective, or inequitable governance mechanisms adopted by relevant actors, rather than a complete absence of governance. MNEs, through their governance mechanisms, commonly create governance gaps. This study distinguishes different types of governance mechanisms to create a typology of governance gaps, such that it contributes to the literature on PCSR by offering a more refined understanding of governance gaps, along with a means to identify mechanisms to address them. Furthermore, it contributes to the literature on GVCs by defining governance-related terms and adding an ethical perspective on MNEs’ global business conduct. To illustrate the typology, this article presents the case of low wages for workers in the textile industry and efforts by H&M to deal with this governance gap. (shrink)

Small businesses in developing countries, as part of global supply chains, are sometimes assumed to respond in a straightforward manner to institutional demands for improved working conditions. This article problematizes this perspective. Drawing upon extensive qualitative data from Tirupur’s knitwear export industry in India, we highlight owner-managers’ agency in avoiding or circumventing these demands. The small businesses here actively engage in irresponsible business practices and “evasion” institutional work to disrupt institutional demands in three ways: undermining assumptions and values, dissociating consequences, (...) and accumulating autonomy and political strength. This “evasion” work is supported by three conditions: void, distance, and contradictions. Through detailed empirical findings, the article contributes to research on both small business social responsibility and institutional work. (shrink)

Global production networks connect multiple producers involved in fragmented manufacturing processes. Major brands and retailers, considered as lead firms, are under increasing pressure to ensure products made through GPNs are produced sustainably. Theories of governance developed to understand dynamics in outsourced production can provide insight into this issue. However, these theories and related empirical research have often focused on relationships between lead firms and upper-tier suppliers. When manufacturing involves multiple fragmented stages, understanding the role of lead firms becomes more difficult. (...) This article considers new governance roles that lead firms, as buyers, are playing when attempting to promote sustainable practices across all stages of production for buyer-driven industries. The focus is exploring the nature of new governance approaches which lead firms have developed in order to address diverse sustainability challenges found within GPNs, particularly related to lower-tier suppliers. These approaches can involve lead firms working through vertical buyer–seller links or developing new horizontal relationships, which link lead firms with lower-tier suppliers and governance processes in these suppliers’ local productive systems. The findings draw from field research examining how top UK garment retailers provide governance to producers involved in creating cotton garments in India and a review of publicised policies and practices of these retailers related to promoting sustainable production. Five types of governance mechanisms that can involve vertical or horizontal links are identified. Considering the growth of new governance relationships expands previous conceptions of the roles of lead firm governance. (shrink)

Why and how have supply chain codes of conduct diffused among lead firms around the globe? Prior research has drawn on both institutional and stakeholder theories to explain the adoption of codes, but no study has modeled adoption as a temporally dynamic process of diffusion. We propose that the drivers of adoption shift over time, from exclusively nonmarket to eventually market-based mechanisms as well. In an analysis of an original data set of more than 1,800 firms between the years 2006 (...) and 2015, we find that strong nonmarket labor institutions in a firm’s home country are critical to initiating and sustaining the diffusion process. Market mechanisms, such as investor scrutiny and brand risk, emerge as important later. Contrary to prior research, we did not find a significant effect from nongovernmental organization (NGO) pressure. We conclude that markets for corporate social responsibility can and do arise, but only after they are effectuated by nonmarket institutions. (shrink)

Labour issues in global supply chains have been a thorny problem for both buyer firms and their suppliers. Research initially focused mostly on the bilateral relationship between buyer firms and suppliers, looking at arm’s-length and close collaboration modes, and the associated mechanisms of coercion and cooperation. Yet continuing problems in the global supply chain suggest that neither governance type offers a comprehensive solution to the problem. This study investigates collaborative governance, an alternative governance type that is driven by buyer firms (...) setting up a coalition with competitor firms to increase leverage and address the supplier and/or host country-specific labour issues. Based on interviews with managers involved in the establishment and management of such coalitions and supplier firms in the garment industry, we examine the rationale behind collaborative governance and discuss its opportunities and challenges in addressing labour issues in global supply chains. (shrink)

ABSTRACT:Global multi-stakeholder initiatives are important instruments that have the potential to improve the social and environmental sustainability of global supply chains. However, they often fail to comprehensively address the needs and interests of various supply-chain participants. While voluntary in nature, MSIs have most often been implemented through coercive approaches, resulting in friction among their participants and in systemic problems with decoupling. Additionally, in those cases in which deliberation was constrained between and amongst participants, collaborative approaches have often failed to materialize. (...) Our framework focuses on two key aspects of these breakdowns: assumptions about the orientation of MSI participants, and the deliberation processes that participants use to engage with each other to create these initiatives and sustain them over time. Drawing from stakeholder and deliberation theories, we revisit the concept of MSIs and show how their deliberative capacity may be enhanced in order to encourage participants to collaborate voluntarily. (shrink)

Flagging labor governance in far-flung supply networks has prompted greater scrutiny of instrumental CSR and calls for models that are tethered more closely to accountability, constraint, and oversight. Political CSR is an apt response, but this paper seeks to buttress its deliberative moorings by arguing that the agonist notion of ‘domesticated conflict’ provides a necessary foundation for substantive deliberation. Because deliberation is more viable and effective when coupled with some means of coercion, a concept of CSR solely premised on reciprocal (...) corporate-stakeholder engagement is pre-mature; efforts should first be directed toward the antecedents of reciprocity and how it is to be achieved, and only then does deliberation become a reliably substantive exercise. The resulting account of agonistic CSR is generated through agonistic principles of realism, pro-action, contestation, and countervailence, and illustrated by the Bangladesh Accord. (shrink)

This article examines the concept of creating shared value as articulated by Michael Porter and Mark Kramer, in non-Western and Western contexts. We define non-Western contexts as those in so-called “developing” countries and emerging economies, whereas Western ones pertain to dominant thinking in “developed” regions. We frame our research in postcolonial theory and offer an overview of existing critiques of CSV. We conduct a critical discourse analysis of 66 articles to identify how CSV is being cited by authors, and potential (...) underlying power dynamics that affect its relevance for non-Western contexts. Our review exposes increasingly critical views about the paradoxical positioning of CSV as an instrumental concept that can offer “win-win” solutions, particularly from those working in non-Western settings. Western perspectives generally tend to be more supportive of its instrumental nature, but also recognize the increasing complexity of the business-society nexus and stakeholder engagement. We argue that the CSV framework requires further development to maintain credibility and applicability, especially in non-Western domains. (shrink)

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 value-generating 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. (shrink)

Implementing corporate social responsibility (CSR) in supply chains is not a trivial task. In fact, many firms in recent years have publicly proclaimed that in order to keep their CSR commitments, they had to reduce reliance on external suppliers by vertically integrating their operations. Our aim in this article is to examine whether there is truly a relationship between a firm’s CSR performance and its level of vertical integration. Drawing on a multi-industry sample of 2,715 firm-year observations, and after addressing (...) endogeneity concerns, we demonstrate that firms with higher CSR performance tend to vertically integrate more (or, outsource less). We also demonstrate that this tendency is weaker for firms that have higher degrees of asset specificity or international diversification. Our core conclusion is that CSR performance and outsourcing are at odds, but firms can reconcile this tension by deepening their collaborations with suppliers. (shrink)

This article shows how the ethical framing of the contemporary issue of modern slavery has evolved in UK construction, a sector in which there is a high risk of labor exploitation. It also examines how these framing dynamics have inhibited the emergence of a common framework of action to deal with the issue. We draw on both framing theory and the literature on the discursive construction of moral legitimacy. Our longitudinal analysis reveals that actors seeking to shape the debate bring (...) their own moral schemes to justify and construct the legitimacy of their frames. Actors cluster their views around five evolving frames: human rights issue (later shifting to hidden crime), moral issue, management issue (later shifting to human moral obligation), social justice issue, and decent work issue—which promote particular normative evaluations of what the issue is, who is responsible, and recommendations for action. Our study contributes to a dynamic and political understanding of the meaning making of modern slavery. We identify the antecedents and conditions that have forestalled the emergence of new patterns of action to tackle modern slavery in the UK construction sector thereby evidencing the effects of the interplay of morally competing frames on field-level change. (shrink)

Local supplier corporate social responsibility in developing countries represents a powerful tool to improve labour conditions. This paper pursues an inter-organizational network approach to the global value chain literature to understand the influence of suppliers’ collective behaviour on their CSR engagement. This exploratory study of 30 export-oriented and first-tier apparel suppliers in Bangladesh, a developing country, makes three relevant contributions to GVC scholarship. First, we show that suppliers are interlinked in a horizontal network that restricts unilateral CSR engagement. This is (...) justified in that unilateral CSR engagement is a source of heterogeneity in labour practices; consequently, it triggers worker unrest. Second, we present and discuss an exploratory framework based on four scenarios of how suppliers currently engage in CSR given their network’s pressure toward collective behaviour: unofficial CSR engagement, geographic isolation, size and competitive differentiation, and external pressure. Finally, we show the need to spread CSR homogeneously among suppliers and to reconceptualize the meaning of CSR in developing countries, encouraging more scrutiny toward horizontal dynamics. (shrink)

To make a business case for corporate sustainability, firms must be able to sell their sustainable products. The influence that firm engagement with non-governmental organizations may have on consumer adoption of sustainable products has been neglected in previous research. We address this by embedding corporate sustainability in a cosmopolitan framework that connects firms, consumers, and civil society organizations based on the understanding of responsibility for global humanity that underlies both the sustainability and cosmopolitanism concepts. We hypothesize that firms’ sustainability engagement (...) and their NGO engagement influence consumer adoption of sustainable products. Empirically, we investigate the adoption of sustainable Eco-circle products made from recycled fibers marketed by Li Ning, a China-based global sportswear brand. We apply a stepwise regression approach to test our hypotheses with paper-and-pencil survey data from 217 Chinese consumers. We find adoption to be positively associated with consumers’ sustainability attitude but not with firms’ sustainability engagement. For firm–NGO engagement, these relationships are reversed: Adoption is positively associated with firm–NGO engagement, but not with consumers’ related attitude. Our results present a picture of the Chinese context in which there is a business case for corporate sustainability if firms’ words about sustainable product strategies are supported by signals from civil society about firm deeds. The results imply that in a Chinese context, firms need to be particularly aware of the role of NGOs when hoping to be rewarded for sustainability. (shrink)

Business Ethics: A European Review, EarlyView.

Ethical sourcing and socially responsible purchasing is increasingly on the business agenda, but developing and implementing policy and practice across a global network of suppliers is challenging. The purpose of this paper is to expand theory on the nature of linkages between firms in a social network, specifically postulating how ties between organizations can be configured to facilitate development, diffusion, and adoption of sustainability initiatives. The theory development provides a lens with which to view the influence of a firm’s structural (...) embeddedness in its organizational social network on developing, diffusing and adopting sustainability initiatives. The focus is on brokers who in various structural alignments help bridge the focal firm’s sustainability initiatives with distant or disconnected stakeholders the focal firm is trying to reach. The brokers help the focal firm engage these stakeholders by sharing knowledge and information regarding sustainability initiatives and by incorporating localized needs into the development of the initiatives to facilitate better diffusion and adoption. The theoretical contribution of this manuscript is a novel perspective on sustainability in organizational networks. This perspective allows for greater explanatory power regarding how organizations can achieve sustainable outcomes that meet a broad base of stakeholder needs and better facilitate sustainability initiatives across a diverse and expansive network. (shrink)

This paper explores the conditions favouring or inhibiting the implementation of strategic corporate social responsibility policies in the context of global value chains. Using transaction cost theory, we specify the economic and behavioural issues raised by strategic CSR policies. We show that the existence of market rewards for such policies does not constitute a solution per se, but tends to increase the difficulties that value chain members face. Bringing TCT into the analysis of the diffusion of strategic CSR policies in (...) GVCs helps us to make different contributions. We first theoretically identify some limiting conditions of strategic CSR policies in GVCs. We also contribute to developing a more robust theoretical perspective for CSR in GVC research, which remains underdeveloped and mostly driven by empirical case studies. Finally, we shed light on new research questions and topics that could guide major theoretical and empirical investigations in the capacity of GVCs members to bypass the numerous difficulties involved in the implementation of strategic CSR policies. (shrink)

A major challenge for supply chain managers is how to manage sourcing relationships to ensure reliable and predictable actions of distant suppliers. The extant research into sustainable supply chain management has traditionally focused on the transactional and collaboration approaches through which buyers encourage suppliers to act responsibly. However, little effort has been devoted to investigating the factors that underpin and enable effective implementation of these two approaches, or to exploring alternative approaches to help sustain an acceptable level of social performance (...) from suppliers. Building on organisational justice theory, we developed a framework in which we propose that buyers’ justice as perceived by suppliers can serve as an alternative and complementary vehicle to the conventional sustainability governance approaches for driving the social justice exhibited by suppliers. The paper sheds new light on an alternative relational approach to help to restrain potentially harmful acts of suppliers. It provides a foundation for new research avenues in the SSCM context and supports more informed decision making by practitioners. (shrink)

This paper puts forth a critical perspective on remedy for business-related human rights abuses. It reflects on the purpose of remedy in Business and Human Rights and argues that effective remedy should address the multiple root causes of abuses to prevent reoccurrences rather than focus on surface issues and isolated cases. To develop a theoretical framework to conceptualize preventative remedy that addresses multiple root causes, this research draws on Fraser’s radical democratic conception of justice and participatory parity. According to the (...) principle, justice is achieved through social arrangements that enable all actors to engage with one another as peers. To conceptualize effective remedy as participatory parity, the paper examines three dimensions—cultural, economic, and political—where injustices or root causes of abuses must be addressed to realize participatory parity. The paper analyzes the illustrative case of the Fair Food Program through the lens of Fraser’s framework. Analysis reveals effective enforcement as necessary to realize participatory parity and address the three dimensions of justice in the context of severe power asymmetries. In the theorized framework, remedy aims to address the multiple root causes of business-related human rights abuses toward prevention and empower rightsholders to engage meaningfully in remedial processes. (shrink)

This article analyzes the United Nations Global Compact under the conceptual framework of explicit versus implicit corporate social responsibility to better understand the operational and governance challenges behind this voluntary global initiative. Using institutional logics theory, we show how the UNGC is a practice that embodies seemingly competing logics. We suggest mechanisms to facilitate the interplay of implicit/explicit CSR and the co-existence of logics that might allow the UNGC to move forward while addressing its critics. We argue that failure to (...) conceptualize the UNGC as a combination of explicit and implicit CSR leaves the UNGC subject to criticism that might be better directed toward organizations that fail to practice explicit CSR. While viewing the UNGC through an integrated CSR framework may not immediately reconcile its critics and proponents, combining elements of both may provide opportunities to posit collaborative solutions to improve the quality, outcome, and legitimacy of UNGC initiatives. (shrink)