Global Diffusion of ISO 9000 Certification through Supply Chains

Abstract

The ISO series of quality management systems standards is widely diffused, with over 560,000 sites certified in 152 countries (as of December 2003). Anecdotal evidence suggests that global chains contributed to this diffusion, in the following sense. Firms in Europe were the first to seek ISO certification in large numbers. They then required their suppliers to do likewise, including those abroad. Once the standard had thus entered other countries, it spread beyond those firms immediately exporting to Europe to be adopted by many other firms in those same countries. This paper empirically examines the validity of this view of the role of chains in global diffusion of ISO 9000. To do so, we decompose the statement that supply chains contributed to the global diffusion of ISO 9000 into a series of four requirements that must be met in order for the original statement to be supported. We then use firm-level data from a global survey of over 5000 firms in 9 countries to test the hypotheses that correspond to these requirements. Our findings are consistent with the view that ISO did diffuse upstream through global chains. In short, this means that firms that export goods or services to a particular country may simultaneously be importing that country's management practices. We conclude by suggesting how these findings might form the basis for future research on the environmental management systems standard ISO 14000.