Supplier Engagement in Sustainability Programs: A Field Experiment of Enabling Versus Coercive Formalization

Abstract

Formal, compliance-focused governance for supply chain sustainability initiatives has a mixed empirical track record. We build on classic research on bureaucracy to examine how “enabling” and “coercive” formalization at the buyer–supplier interface affect attitudes, an important precursor to behavioral engagement. We conduct a randomized field experiment with the supplier community of a South African insurance company to directly compare treatment effects of enabling and coercive interventions. We report and discuss the enabling intervention’s positive attitudinal effects and the moderation of these effects by supplier characteristics. Our findings also reveal some notable null effects, especially from the coercive intervention. We believe this work contributes to a more nuanced understanding of formal governance choices in supply chains and their impact on supplier engagement.