Green sourcing practices in Korea

Abstract

PurposeBased on the empirical findings from a survey of Korean firms with greater environmental risks, this paper aims to identify variables that either promote or inhibit the successful implementation of green sourcing strategy and to evaluate the effects of green sourcing on the firm’s supplier selection, waste management, packaging and regulatory compliance.Design/methodology/approachTo help multinational firms configure an environmentally conscious (green) sourcing strategy, this paper conducted a mail-questionnaire survey and then analyzed the survey results obtained from more than 300 valid responses by using a series of multinomial logistics regression, ordinal regression and discriminant analyses. In addition, the authors performed a cluster analysis, chi-square tests of independence and cross tabulation to analyze the data.FindingsThe authors found that the main driver for the firm’s green sourcing practices is its customer needs and preferences for the environment-friendly product and services instead of peer pressure or government mandates (including environmental regulation). Surprisingly, the authors also found that the firm with a greater purchasing power did not necessarily factor the supplier’s advances in environmental programs into its supplier selection, although the firm’s amount of purchase volume can give it a bargaining strength to pressure its supplier to adopt the environmental programs.Originality/valueA rapid industrialization of Asia-Pacific countries for the past several decades brought unprecedented economic prosperity in those countries. However, it also eroded ecosystem quality gradually through air, water and ground contamination and pollution caused by industrial activities. Such concerns have prompted many firms in the Asia-Pacific region to reassess their up-stream supply chain strategy such as sourcing strategy. This paper is one of the first to examine how Asia-Pacific firms develop such strategy and identify the most common green sourcing practices that can be guidance for other firms embracing environmental programs.