Sustainable supplier development practices: Drivers and enablers in a global context

Abstract

The objective of this paper is to study the impact of institutional pressures at the country level (i.e., coercive, regulatory, normative) on the adoption of sustainable supplier development practices. Globalization is allowing firms to expand in new markets and to leverage on localization advantages by establishing foreign plants and sourcing internationally. Plants located in different countries might be subject to different institutional pressures shaping their organizational response to sustainability within and outside their domain (e.g., in relation to their suppliers). The paper also aims to examine if firm specific capabilities (e.g., supply chain integration) play an enabling role in the adoption of sustainable supplier development practices. To analyse these relationships we relied on both primary and secondary data, and used hierarchical linear modelling to test our hypotheses. The results show that mimetic pressures have a positive effect on the adoption of sustainable supplier development and that this influence is positively moderated by the firm’s level of supplier integration. Coercive and normative pressures have no effect on the adoption of sustainable supplier development practices. Overall our results suggest that sustainable supplier development is a proactive practice adopted for competitive reasons and enabled by firm specific capabilities.