What drives the dissemination of CSR practices in global value chains? An institutional and psychological perspective

Abstract

This study investigates how supply chain professionals in buying and supplying firms are motivated to engage in corporate social responsibility (CSR) practices within global value chains (GVCs). Based on the multiple needs theory of justice, social exchange theory, and the institution-based view, we develop hypotheses and test them against data collected from 201 supply chain professionals. We find that buyers’ intentions to cascade CSR practices to suppliers is particularly driven by instrumental and relational motives. In contrast, suppliers’ intentions to engage in CSR is largely determined by moral outrage. Moreover, significant effects are revealed for the institutional conditions on buyers’ CSR cascading intentions and on suppliers’ CSR implementation intentions. The misalignment between buyers’ and suppliers’ motives to engage in CSR activities is discussed as a major challenge of cascading CSR practices in GVCs. The study contributes to the international business literature by combining an institutional and psychological examination of individuals’ motivation to engage in CSR along GVCs. Moreover, we derive practical implications for supply chain managers.