Sustainability related impacts of digitalisation on cooperation in global value chains: An exploratory study comparing companies in China, Brazil and Germany

Abstract

While digitalisation is reconfiguring global value chains (GVCs), the implications for sustainable development, especially in emerging economies, have not yet been thoroughly explored. In order to design more sustainable GVCs this gap must be addressed. This study examines two implications of digitalisation in value chains: first, how polarisation may lead to inequal development; and secondly, whether digital enhanced transparency can be an enabler of companies’ environmental management systems (EMS). A survey-based approach is used to compare the developments of companies in China, Brazil and Germany and gain insights into countries that approach digital transformations from different starting points. The results indicate that polarisation tendencies on a country level are not as pronounced as experts predicted. Across all countries, less than 10% of companies reported that collaboration processes are being fully digitalised, while partial digitalisation is more common, ranging from 46% in Brazil (n = 116), to 61% in China (n = 441) and 63% in Germany (n = 104). Polarisation tendencies are stronger among small- and medium-sized companies (SMEs) across all countries. As SMEs form the backbone of countries' economies, this should be addressed by global governance. Digital enhanced transparency for EMS is not yet widespread, with only 9% of the German, 3% of the Brazilian and 6% of the Chinese companies integrating production data into their EMS in a fully digital way. The results of this study suggest that the automotive sector would provide a suitable object for future research, as it displays clear differences to other industries.