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Socially Sustainable Supply Chain Management and Suppliers’ Social Performance: The Role of Social Capital

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Abstract

The implementation of socially sustainable supply chain management (SSCM) practices (i.e. assessment and collaboration) to tackle suppliers’ social deficiencies (e.g. the use of child labour) often requires a level of cooperation that can be difficult to establish. Despite this daunting challenge, scant scholarly attention has been paid to explore how the implementation of socially SSCM practices can be effectively facilitated and enhanced. Drawing on social capital theory, this study examines the individual impact of assessment and collaboration practices on suppliers’ social performance and explores whether and how these effects can be moderated (strengthened) by the level of social capital (i.e. relational, cognitive, and structural) embedded in the buyer–supplier relationship. Based on a survey of 119 manufacturing companies in the UK, we found that assessment practices are less likely to influence suppliers to improve social performance compared to collaboration practices. However, when relational and structural capital are manifested in the relationship, assessment practices become significant in driving suppliers’ social performance. We also found that the positive impact of collaboration practices is more pronounced when relational and cognitive capital are established in the relationship. This paper contributes to the growing socially SSCM literature by disentangling the vital and relative importance of social capital dimensions on the implementation of socially SSCM practices.

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Notes

  1. FAME is a database contains information on companies in the UK and Ireland including contact, activities, ownership, and financial information.

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Authors and Affiliations

  1. Department of Business Management, School of Business, Mutah University, Alkarak 61710, Jordan

    Mohammad Alghababsheh

  2. Brunel Business School, Brunel University London, Uxbridge UB8 3PH, UK

    David Gallear

Authors
  1. Mohammad Alghababsheh
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  2. David Gallear
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Correspondence to Mohammad Alghababsheh.

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Appendix

Appendix

Measurement items and reliability and validity test

Items

Standardised loadings

Assessment practices C.R. = 0.86 AVE = 0.61

 

 We developed an ethical code of conduct with our key supplier

0.682

 We conduct audits of the health and safety of our supplier’s employees

0.768

 We sent health and safety questionnaires to our supplier in order to monitor their compliance

0.704

 We use a certification programme (e.g. SA8000) to recognise the supplier’s corporate social responsibility capability

0.667

 We assess supplier’s social performance through form evaluation using established guidelines and procedures

0.848

 We provide our supplier with feedback about the results of such evaluation

0.821

 Collaboration practices C.R. = 0.81 AVE = 0.52

 

We offer financial incentives for the supplier if they improve commitment to social sustainability

0.613

 We visit our supplier’ facilities to help them improve their performance

0.767

 We provide training/education for the supplier’s personnel about corporate social responsibility practices and the required skills

0.792

 We developed new product/processes with our supplier that reduced health and safety hazards for employees

0.721

Relational capital C.R. = 0.88 AVE = 0.61

 

 The relationship is characterized by close interaction at multiple levels

0.732

 The relationship is characterized by mutual trust at multiple levels

0.853

 The relationship is characterized by mutual respect at multiple levels

0.739

 The relationship is characterized by mutual friendship at multiple levels

0.752

 The relationship is characterized by high levels of reciprocity

0.838

Cognitive capital C.R. = 0.91 AVE = 0.73

 

 We have similar organisational culture /values and management style with supplier

0.864

 We have similar philosophies/approaches to business dealings

0.847

 We have compatible goals and objectives with suppliers

0.828

 We have the same vision of business in the relationships

0.928

Structural capital C.R. = 0.86 AVE = 0.61

 

 We engage in and organise social events with our suppliers

0.774

 We have frequent communication with our major supplier

0.669

 We maintain a frequent and intensive interaction between personnel

0.849

 We maintain close social relationships with our major suppliers

0.822

Supplier’s social performance C.R. = 0.93 AVE = 0.83

 

 We have improved compliance with human rights in the supplier’ facilities

0.934

 We have improved safety and labour conditions in the supplier’ facilities

0.938

 We have improved compliance with child labour employment in the supplier’ facilities

0.856

Supplier’s dependency C.R. = 0.60 AVE = 0.85

 

 If we discontinued our relationship, it would have difficult for this supplier to make up the sales volume in our trading area

0.67

 It would be difficult for this supplier to replace us

0.66

 This supplier is quite dependent on us

0.95

 This supplier does not have a good alternative to us in our trading area

0.77

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Alghababsheh, M., Gallear, D. Socially Sustainable Supply Chain Management and Suppliers’ Social Performance: The Role of Social Capital. J Bus Ethics 173, 855–875 (2021). https://doi.org/10.1007/s10551-020-04525-1

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