Abstract

The absence of an effective public model (e.g., government regulations and law enforcement) in developing countries has driven clothing brands and retailers to rely on a private voluntary formal model (e.g., compliance and collaboration approaches) to manage suppliers' internal social issues (e.g., poor working conditions). However, this model has been recently criticised for falling short in addressing these issues as it overlooks their main root causes. In this study, we suggest that suppliers' internal social issues can be driven by buyers' unfair practices, and therefore, we propose and examine that buyers' justice can ensure suppliers' internal social performance. We further postulate and investigate that addressing these issues would result in advantages for buyers beyond traditional performance outcomes in the form of reduced supply operational risk. Based on a census of the 117 suppliers comprising the ready-made garment industry in a Middle Eastern country (Jordan), we received survey responses from 97 suppliers and their shop floor workers. The analysis revealed that only buyer’s distributive and procedural justice, but not interactional justice, are positively related to suppliers' internal social performance. We also found evidence that improving suppliers' internal social performance can diminish supply operational risk. This study contributes to the extant research by empirically investigating a new approach to handle the increase in suppliers' internal social issues in a developing country context. It also does by capturing suppliers' internal social performance from the workers' perspective and highlighting the role of improved suppliers' internal social performance on mitigating supply operational risk.

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