Buyer-led environmental supplier development: Can suppliers really help it?

doi:10.1016/j.ijpe.2020.107969

International Journal of Production Economics

Volume 233, March 2021, 107969

https://doi.org/10.1016/j.ijpe.2020.107969 Get rights and content

Abstract

The importance of supplier development programs to enhance supply chain environmental capabilities has often been posited. However, the literature is limited in identifying and explaining the factors that may influence or mediate the effectiveness of such programs. This paper examines the role of environmental supplier development programs led by the buying organization on supplier environmental practices, while testing the mediating effects of the supplier in the forms of resource allocation and collaboration with the buyer. The relationships are tested based on survey data from 267 supplier organizations in the UK using Partial Least Squares (PLS). The results indicate that supplier development in the form of setting requirements and audits has a wide, positive impact on all supplier environmental activities, while environmental supplier development in the form of direct projects only affects supplier environmental activities in logistics and transport. The results for the mediation effects tested are varied: while supplier collaboration is important to enhance the supplier logistics and transport activities, supplier resource allocation proves to be mediating the impact of environmental supplier development on the supplier energy efficiency and logistics and transport activities. The research sheds new light on the effectiveness of supplier development and environmental programs. The findings indicate that buying organizations should make explicit reference to the way they define supplier collaboration and resource allocation for their environmental plans and environmental supplier development programs to be effective.

Section snippets

Introduction and background

Moving toward an environmentally-friendly supply chain largely depends on sourcing and supply management decisions and actions. Among them, supplier management, evaluation, and development have essential roles to play (Fu et al., 2012). The literature review on supplier environmental management, conducted in this research, points out various studies on the role of supply management in green supply (Agi and Nishant 2017; Bowen et al., 2001; Ferretti et al., 2007), environmental supplier

Theory and hypotheses development

An organization's plans to enhance its environmental performance largely depend on internal and external resources and capabilities (Blome et al., 2014a). Taking the supply chain as the main source of external capabilities and with a particular focus on the relationships among supplier development programs and supplier environmental activities, this section explains the relevance of Resource Based View (RBV), Natural Resource Based View (NRBV), and Knowledge Based View (KBV) as the theoretical

Research design

The research hypotheses developed in section 2, are tested using survey empirical data. Details of the hypotheses’ constructs operationalization, their measurement instruments, as well as the justification for the choice of survey method, data collection medium, and data analysis methods are outlined in the following sub-sections.

Hypotheses test results

To illustrate the results clearly and in detail, the research structural model, featured earlier in Fig. 1, is broken down in Table 3, where the direct and indirect effects and their t-values are provided. The results, in summary, show that the hypothesis groups H1 and H2 are supported (with an exception of H2a) directly or via the SRA and BSC mediators, which means that ESD_ra and ESD_dp boost SEA_mm, SEA_ee, and SEA_lt (except ESD_dp →SEA_mm). To elaborate these, the results, presented in Table 3,

Conclusions

The empirical study of this paper, through a cross-sectional survey of supplier organizations, derives a good profile of the links among different types of buyer-led environmental supplier development approaches, their expected outcomes, and key mediating factors from the supplier's viewpoint. This research advances environmental management and supplier development literature by revealing that the buying organization and its environmental supplier development (ESD) programs can promote major

Acknowledgement

The authors would like to thank the editor and three anonymous reviewers for their critical reviews and constructive comments on the earlier editions of this paper.

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