Multinational Corporate Power, Influence and Responsibility in Global Supply Chains

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.