The Antecedents and Consequence of Supplier Unethical Behaviour in Buyer-Supplier Relationship in Tanzania: Testing using the PLS Approach

doi:10.7176/jesd/13-2-06

Abstract

Using social exchange theory , this paper investigates the antecedents of supplier unethical practices on continuity of buyer-supplier relation and its consequence on firm performance. The analysis of 130 informants from public entities in Tanzania, the results indicates that two supplier’s unethical practices have significant impact on the continuity of buyer-supplier relation which include corruption and supplier deceitful. Using the mediating role continuity of buyer-supplier relationship, the study indicates that corruption and deceitful affect the firm performance (quality and delivery). The research conclude that the public entities should be very careful on the effects of unethical practices on continuity of relationship and managers in public organizations should not take for granted particularly the corruption practices and deceitful. This study provides insightful contribution to practitioners and researchers intended to conducted research on ethical supply chain. Keywords: Unethical behaviour; Opportunism; Corruption; Deceitful; Buyer-supplier DOI: 10.7176/JESD/13-2-06 Publication date: January 31 st 2022

Highlights

The continuity and success of buyer–supplier relationship depends mainly on the ethical practices of both partners in the relationship
Considering the direct relations included in our model, it has been determined that two factors of corruption (β=0.253, p=0.020) and supplier's deceitful behaviors (β=0.269, p=0.003) have significant and direct effects on the continuity of the buyer-supplier relationship while opportunism demonstrated no significant effects
The model that was tested using Tanzania environment explains that unethical behaviors of suppliers have huge impact to the continuity of relationships, and the continuity of buyer-supplier relationship mediate the effects between supplier deceitful and delivery performance as well quality performance

Summary

Introduction

The continuity and success of buyer–supplier relationship depends mainly on the ethical practices of both partners in the relationship. Over the past decades, the unethical practices from suppliers has increased gradually due numerous factors that affect the longevity of the relationship in continuum. Jamil et al (2019) highlighted the antecedent that triggered such behaviour including the overdependence of buyer on suppliers, sole-source relationship and little benefits of the suppliers in the contracts. Hawkins et al (2008) revealed that opportunism as the main antecedent of unethical practices from suppliers that emerged due to lack information sharing between the two sides. The consequence of supplier opportunism includes the risk of shirking responsibilities by suppliers, providing false information, making hollow promises to buyer and loosing of confidential information to competitors (Yan and Kull, 2015)

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