The association between supply chain structure and transparency: A large‐scale empirical study

Abstract

AbstractAn emerging body of work acknowledges the challenges focal firms face in gathering material information about their extended supply chains and begins to point to the role of supply chain structure in influencing supply chain transparency. Still, large‐scale empirical evidence on this complex association remains elusive, especially at the supply chain level of analysis. We begin to bridge this empirical gap by examining whether supply chain structure systematically associates to supply chain transparency in the context of the collective public environmental, social, and governance (ESG) disclosures made by a focal firm's customers, suppliers, and subsuppliers. To shed light on this underexplored empirical phenomenon, we gather Bloomberg SPLC data and Bloomberg ESG data about 4803 firms and 20,504 contractual ties organized in 187 extended supply chains. We find that supply chain density positively associates with supply chain transparency, whereas supply chain clustering holds a negative association. We also find that supply chain geographical heterogeneity positively associates with supply chain transparency. Our results significantly expand the literature on supply chain transparency and are relevant to supply chain professionals because they emphasize the central role of supply chain structure in enabling or constraining supply chain transparency.