Supply chain resilience to climate change inflicted extreme events in agri-food industry: The role of social capital and network complexity

Abstract

In light of climate change inflicted extreme events—such as floods, fires, droughts, storms, and hurricanes, along with the consequent widespread business disruptions—supply chain resilience (SCR) has emerged as a critical tool to sustain business performance. However, little in-depth theoretical and empirical research has been conducted in relation to the link between exposure to climate change and SCR and the underlying mechanisms and boundary conditions that explicate this relationship. Using time-lagged data drawn from 260 firms in the Australian food supply chains, we examined how exposure to climate change influences SCR in the face of extreme events, and whether intra- and inter-firm social capital and network complexity affect this relationship. Our analysis revealed that exposure to climate change events has a direct positive—albeit not statistically significant—influence on SCR to extreme events. Nevertheless, we found that exposure to climate change significantly and positively influences SCR to extreme events through the mediation of intra- and inter-firm social capital. Additionally, we uncovered that network complexity does not influence the effect of intra-firm social capital on SCR to extreme events, whereas it does negatively influence that of inter-firm social capital. The reliability and validity of our results were confirmed by means of robustness tests. Our study, which has several theoretical and practical implications, makes specific contributions to the United Nations Development Goals.