Skip to main content
SpringerLink
Log in

Multinational Corporate Power, Influence and Responsibility in Global Supply Chains

  • Published:
Journal of Business Ethics Aims and scope Submit manuscript

Abstract

This paper examines the question of how to determine the extent of a multinational corporation (MNC)’s corporate social responsibility for actions by its suppliers. Drawing on three theories of power and influence from the organization and management literature—resource-dependence theory, social exchange theory and social network theory, this paper presents a conceptual framework for analysing the extent of power and influence of an MNC in a global supply chain based on a consideration of (i) economic and non-economic exchanges and (ii) direct and indirect exchanges in the MNC’s industry network. The paper also shows how the legal concept of complicity can be incorporated by considering the knowledge links of the MNC to other organizations in the industry network. Finally, the paper demonstrates how the concepts can be integrated to construct a power assessment grid which can be used to assess the extent of responsibility of an MNC for the actions of its suppliers and other parties in the industry, as well as a map of power and knowledge relationships between organizations in the industry which can be used for further analyses using social network analysis techniques.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1
Fig. 2
Fig. 3

Similar content being viewed by others

References

  • Amaeshi, K. M., Osuji, O. K., & Nnodim, P. (2008). Corporate social responsibility in supply chains of global brands: A boundaryless responsibility? Clarification, exceptions and implications. Journal of Business Ethics, 81, 223–234.

    Article  Google Scholar 

  • Amba-Rao, S. C. (1993). Multinational corporate social responsibility, ethics, interactions and third world governments: An agenda for the 1990’s. Journal of Business Ethics, 12, 553–572.

    Article  Google Scholar 

  • Asgary, N., & Mitschow, M. C. (2002). Toward a model for international business ethics. Journal of Business Ethics, 36, 239–246.

    Article  Google Scholar 

  • Barth, F. (1967). Economic spheres in Dafur. In R. Firth (Ed.), Themes in economic anthropology (pp. 699–721). London: Tavistock.

    Google Scholar 

  • Benton, W. C., & Maloni, M. (2005). The influence of power driven buyer/seller relationships on supply chain satisfaction. Journal of Operations Management, 23(1), 1–22.

    Article  Google Scholar 

  • Borgatti, S. P., & Foster, P. C. (2003). The network paradigm in organizational research: A review and typology. Journal of Management, 29, 991–1013.

    Article  Google Scholar 

  • Borgatti, S. P., & Li, X. (2009). On social network analysis in a supply chain context. Journal of Supply Chain Management, 45(2), 5–22.

    Article  Google Scholar 

  • Bourdieu, P. (1980). Le capital social. Actes de la Recherche en Sciences Sociales, 31, 2–3.

    Google Scholar 

  • Bourdieu, P. (1989). Social space and symbolic power. Sociological Theory, 7(1), 14–25.

    Article  Google Scholar 

  • Branco, M. C., & Rodrigues, L. L. (2006). Corporate social responsibility and resource-based perspectives. Journal of Business Ethics, 69(2), 111–132.

    Article  Google Scholar 

  • Brass, D. J., & Burkhart, M. E. (1993). Potential power and power use: An investigation of structure and behaviour. Academy of Management Journal, 36, 441–470.

    Article  Google Scholar 

  • Brass, D., Butterfield, K., & Skaggs, B. (1998). Relationships and unethical behaviour: A social network perspective. Academy of Management Review, 23, 14–31.

    Google Scholar 

  • Buckley, P. J. (2011). International integration and coordination in the global factory. Management International Review, 51(2), 269–283.

    Article  Google Scholar 

  • Burt, R. S. (1992). Structural holes: The social structure of competition. Cambridge MA: Harvard University Press.

    Google Scholar 

  • Business Leaders Initiative on Human Rights. (2003). Report 1: Building understanding. London: Business Leaders Initiative on Human Rights.

    Google Scholar 

  • Business Leaders Initiative on Human Rights. (2004). Report 2: Work in progress. London: Business Leaders Initiative on Human Rights.

    Google Scholar 

  • Chamberlain, G. (2010, August 8). Gap, next and M&S in new sweatshop scandal. The Observer.

  • Chen, S. (2009). Corporate responsibilities in internet-enabled social networks. Journal of Business Ethics, 90(4), 523–536.

    Article  Google Scholar 

  • Chen, S., & Choi, C. J. (2005). A social exchange perspective on business ethics: An application to knowledge exchange. Journal of Business Ethics, 62, 1–11.

    Article  Google Scholar 

  • Cohen, M. A., & Mallik, S. (1997). Global supply chains: Research and applications. Production and Operations Management, 6(3), 193–210.

    Article  Google Scholar 

  • Cook, K. S., & Whitmeyer, J. M. (1992). Two approaches to social structure: Exchange theory and network analysis. Annual Review of Sociology, 18, 109–127.

    Article  Google Scholar 

  • Cropanzano, R., & Mitchell, M. S. (2005). Social exchange theory: An interdisciplinary review. Journal of Management, 31(6), 874–900.

    Article  Google Scholar 

  • Davis, G. F., & Cobb, J. A. (2010). Resource dependence theory: Past and future. Research in the Sociology of Organizations, 28(1), 21–42.

    Article  Google Scholar 

  • Dedrick, J., Kraemer, K. L., & Linden, G. (2009). Who profits from innovation in global value chains? A study of the iPod and notebook PCs. Industrial and Corporate Change, 19(1), 81–116.

    Article  Google Scholar 

  • Emerson, R. M. (1981). Social exchange theory. In M. Rosenberg & R. H. Turner (Eds.), Social psychological perspectives (pp. 30–65). New York: Basic Books.

    Google Scholar 

  • Etgar, M., Cadotte, E. R., & Robinson, L. M. (1978). Selection of an effective channel control mix. Journal of Marketing, 42(3), 53–58.

    Article  Google Scholar 

  • Fassin, Y. (2005). The reasons behind non-ethical behaviour in business and entrepreneurship. Journal of Business Ethics, 60(3), 265–279.

    Article  Google Scholar 

  • Freeman, L. (2004). The development of social network analysis: A study in the sociology of science. Vancouver, BC: Empirical Press.

    Google Scholar 

  • French, J. R. P. & Raven, B. (1959). The bases of social power. In P. Dorwyn & D. E. Cartwright (Eds.), Studies in social power (pp. 150–157). University of Michigan, Ann Arbor, MI.

  • Garriga, E. (2009). Cooperation in stakeholder networks: Firms’‘Tertius Iungens’ role. Journal of Business Ethics, 90(4), 623–637.

    Article  Google Scholar 

  • Gaski, J. F. (1984). The theory of power and conflict in channels of distribution. The Journal of Marketing, 48(3), 9–29.

    Article  Google Scholar 

  • Geppert, M., & Dörrenbächer, C. (2014). Politics and power within multinational corporations: Mainstream studies, emerging critical approaches and suggestions for future research. International Journal of Management Reviews, 16(2), 226–244.

    Article  Google Scholar 

  • Gereffi, G., Humphrey, J., & Sturgeon, T. (2005). The governance of global value chains. Review of International Political Economy, 12(1), 78–104.

    Article  Google Scholar 

  • Gulati, R. (1995). Social structure and alliance formation patterns: A longitudinal analysis. Administrative Science Quarterly, 40(4), 619–652.

    Article  Google Scholar 

  • Harland, C. M. (1996). Supply chain management: Relationships, chains and networks. British Journal of Management, 7(s1), S63–S80.

    Article  Google Scholar 

  • Hoegl, M., & Wagner, S. M. (2005). Buyer-supplier collaboration in product development projects. Journal of Management, 31(4), 530–548.

    Article  Google Scholar 

  • International Commission of Jurists. (2008). Corporate complicity and legal accountability, volume 1: Facing the facts and charting a legal path. International Commission of Jurists, Geneva.

  • International Institute for Environment and Development. (2005). Stakeholder power analysis. Retrieved from http://www.policy-powertools.org.

  • Iyer, G. R. (2001). International exchanges as the basis for conceptualizing ethics in international business. Journal of Business Ethics, 31, 3–24.

    Article  Google Scholar 

  • Jamali, D. (2008). A stakeholder approach to corporate social responsibility: A fresh perspective into theory and practice. Journal of Business Ethics, 82, 213–231.

    Article  Google Scholar 

  • Kadish, S. H. (1985). Complicity, cause and blame: A study in the interpretation of doctrine. California Law Review, 73(2), 323–410.

    Article  Google Scholar 

  • Ketchen, D. J., & Hult, G. T. M. (2007). Bridging organization theory and supply chain management: The case of best value supply chains. Journal of Operations Management, 25(2), 573–580.

    Article  Google Scholar 

  • Kotabe, M., & Murray, J. Y. (2004). Global sourcing strategy and sustainable competitive advantage. Industrial Marketing Management, 33(1), 7–14.

    Article  Google Scholar 

  • Langfield-Smith, K., & Greenwood, M. R. (1998). Developing co-operative buyer-supplier relationships: A case study of Toyota. Journal of Management Studies, 35(3), 331–353.

    Article  Google Scholar 

  • Lee, S. H. M. (2013). Ethics and expertise: A social networks perspective. Journal of Business Ethics, 118(3), 607–621.

    Article  Google Scholar 

  • Levi-Strauss, C. (1966). The elementary structure of kinship. Boston: Beacon Press.

    Google Scholar 

  • Lund-Thomsen, P., & Lindgreen, A. (2014). Corporate social responsibility in global value chains: Where are we now and where are we going? Journal of Business Ethics, 123(1), 11–22.

    Article  Google Scholar 

  • Lusch, R. F., & Brown, J. R. (1982). A modified model of power in the marketing channel. Journal of Marketing Research, 19(3), 312–323.

    Article  Google Scholar 

  • Mamic, I. (2005). Managing global supply chain: The sports footwear, apparel and retail sectors. Journal of Business Ethics, 59(1–2), 81–100.

    Article  Google Scholar 

  • Marcus, P. M., & House, J. S. (1973). Exchange between superiors and subordinates in large organizations. Administrative Science Quarterly, 18(2), 209–222.

    Article  Google Scholar 

  • Mauss, M. (1967). The gift. New York: Norton.

    Google Scholar 

  • McBarnet, D. (2009). Corporate social responsibility beyond law, through law, for law. In D. J. McBarnet, A. Voiculescu, & T. Campbell (Eds.), The new corporate accountability: Corporate social responsibility and the law (pp. 9–58). Cambridge: Cambridge University Press.

    Google Scholar 

  • Molm, L., & Cook, K. (1995). Social exchange and exchange networks. In K. S. Cook, G. A. Fine, & J. S. House (Eds.), Sociological perspectives on social psychology (pp. 209–235). Boston: Allyn & Bacon.

    Google Scholar 

  • Oliver, A. L., & Ebers, M. (1998). Networking network studies: An analysis of conceptual configurations in the study of inter-organizational relationships. Organization Studies, 19(4), 549–583.

    Article  Google Scholar 

  • Pfeffer, J. (1992). Managing with power. Boston, MA: Harvard Business School Press.

    Google Scholar 

  • Pfeffer, J., & Salancik, G. R. (1978). The external control of organizations: A resource dependence approach. NY: Harper and Row Publishers.

    Google Scholar 

  • Phillips, R. A. (2010). Ethics and network organizations. Business Ethics Quarterly, 20(3), 533–543.

    Article  Google Scholar 

  • Phillips, R., & Caldwell, C. B. (2005). Value chain responsibility: A farewell to arm’s length. Business and Society Review, 110(4), 345–370.

    Article  Google Scholar 

  • Piore, M. (1997). The economics of the sweatshop. In A. Ross (Ed.), No Sweat: Fashion, free trade and the rights of garment workers (pp. 135–142). London: Verso.

    Google Scholar 

  • Ratner, S. R. (2001). Corporations and human rights: A theory of legal responsibility. Yale Law Journal, 111, 443–545.

    Article  Google Scholar 

  • Reed, D. (1999). Three realms of corporate responsibility: Distinguishing legitimacy, morality and ethics. Journal of Business Ethics, 21(1), 23–35.

    Article  Google Scholar 

  • Reggio, A. (2005). Aiding and abetting in international criminal law: The responsibility of corporate agents and businessmen for «Trading with the Enemy» of mankind. International Criminal Law Review, 5(4), 623–696.

    Article  Google Scholar 

  • Roloff, J., & Aßländer, M. S. (2010). Corporate autonomy and buyer–supplier relationships: The case of unsafe Mattel toys. Journal of Business Ethics, 97(4), 517–534.

    Article  Google Scholar 

  • Rowley, T. J. (1997). Moving beyond dyadic ties: A network theory of stakeholder influences. Academy of Management Review, 22(4), 887–910.

    Google Scholar 

  • Schrempf, J. (2012). The delimitation of corporate social responsibility upstream, downstream, and historic CSR. Business and Society, 51(4), 690–707.

    Article  Google Scholar 

  • Schrempf, J. (2014). A social connection approach to corporate responsibility the case of the fast-food industry and obesity. Business and Society, 53(2), 300–332.

    Article  Google Scholar 

  • United Nations. (2003). Draft norms on the responsibilities of transnational corporations and other business enterprises with regard to human rights, E/CN.4/Sub.2/2003/12.

  • United Nations. (2008a). Clarifying the concepts of “sphere of influence” and “complicity”. Report of the special representative of the secretary-general on the issue of human rights and transnational corporations and other business enterprises A/HRC/8/16.

  • United Nations. (2008b). Protect, respect and remedy: A framework for business and human rights. Report of the special representative of the secretary-general on the issue of human rights and transnational corporations and other business enterprises A/HRC/8/5.

  • Uzzi, B. (1997). Social structure and competition in interfirm networks: The paradox of embeddedness. Administrative Science Quarterly, 42(1), 35–67.

    Article  Google Scholar 

  • Walker, G., Kogut, B., & Shan, W. (1997). Social capital, structural holes and the formation of an industry network. Organization Science, 8(2), 109–125.

    Article  Google Scholar 

  • Walsh, D., & Greenhouse, S. (2012). Certified safe, a factory in Karachi still quickly burned. The New York Times.

  • Willer, D., Lovaglia, M. L., & Markovsky, B. (1997). Power and influence: A theoretical bridge. Social Forces, 76(2), 571–603.

    Article  Google Scholar 

  • Xinhua News Agency. (2008). China seizes 22 companies with contaminated baby milk powder. Xinhua News Agency. Retrieved Sept 16, 2008, from https://web.archive.org/web/20121021182912/http://news.xinhuanet.com/english/2008-09/17/content_10046949.htm.

  • Zaheer, A., & McEvily, B. (1999). Bridging ties: A source of firm heterogeneity in competitive capabilities. Strategic Management Journal, 20(12), 1133.

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Faculty of Business and Law, University of Newcastle, Callaghan, NSW, 2308, Australia

    Stephen Chen

Authors
  1. Stephen Chen
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Stephen Chen.

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Chen, S. Multinational Corporate Power, Influence and Responsibility in Global Supply Chains. J Bus Ethics 148, 365–374 (2018). https://doi.org/10.1007/s10551-016-3033-x

Download citation

  • Received:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s10551-016-3033-x

Keywords

Search

Navigation