The Communication of Corporate Social Responsibility (CSR) Through the Supply Chain: A SME Perspective

Abstract

The increasing use of strategic supply chain alliances provides a potentially rich and growing communication link between suppliers and customers about how they should conduct their economic, social and environmental relations. These communications can be either intended or unintended and may be expected as part of day-to-day practical interactions between suppliers and customers. Intended communications include performance expectations in quality level and consistency, pricing, delivery time and demand forecasts from the customer upstream to suppliers, and technical data about component improvements and new technologies from suppliers downstream to customers. Unintended communications may include transfer of sensitive proprietary information and indications of operating problems. We postulate that many of these communications include topics about the role of business in society, which has commonly come to be known as corporate citizenship or corporate social responsibility (CSR). But, far from being accepted, the fundamental contents of these issues are constantly being debated on both the academic and the practitioner stage. And placing them in a supply chain context potentially adds several more layers of disagreement and debate (New and Westbrook, 2004, p. v). As New (2004b) points out, the subject of ethics and social responsibility in the supply chain ‘remains . . . one of heated controversy, and is the subject of a vast and incoherent literature’ (p. 253). We set out here to clarify the concepts and issues that define corporate social responsibility and propose an agenda for the further study of the communication of CSR principles and practices through the supply chain as a first step toward coherence. In a market economy, corporations provide the most effective vehicle for generating new wealth and for sustaining communities. Although much attention has been given to how and why corporations voluntarily link their futures to the community and environment in which they operate, little research exists on how corporations may require or encourage one another to develop these environmental, community and social capabilities through their supply chain relations, even in the context of the partnership or relational contracting form. Because supply chains play an important, if not leading, role in global economic activity (Dyer and Chu, 2003), the influence of this communication network needs to be better understood. CSR is an umbrella term for a wide-ranging collection of social issues of concern to the firm’s stakeholders (Smith, 2003). Although CSR is generally defined as consisting of