Developing country sub‐supplier responses to social sustainability requirements of intermediaries: Exploring the influence of framing on fairness perceptions and reciprocity

Abstract

Research on social sustainability in multi‐tier supply chains is limited. Specifically, we know very little about a) the micro‐processes involved in the way in which sub‐suppliers (i.e., first‐tier suppliers or sourcing agents) respond to the sustainability requirements imposed by their intermediaries; and b) the micro‐level antecedents that condition their responses. To address these gaps, we used a longitudinal multiple case study method to explore multiple intermediary – sub‐supplier dyads in South India's knitwear garment industry and drew upon constructs of behavioural economics. We found that the way in which intermediaries frame social sustainability requirements and their associated procedures influence both the way in which sub‐suppliers perceive the procedural fairness of those requirements and the way in which they thus reciprocate. When intermediaries frame social sustainability requirements as ‘opportunity’ and engage in various procedures perceived to be procedurally fair by sub‐suppliers, the latter reciprocate positively. Contrastingly, when intermediaries frame social sustainability requirements as ‘insulation’ and engage in various procedures perceived to be procedurally unfair by sub‐suppliers, the latter reciprocate negatively. Under the production‐dominant framing, sub‐suppliers exhibit positive reciprocity only related to processing production orders. Our analysis inductively generated propositions that emphasize the important role played by framing in shaping the perceptions of fairness held by sub‐suppliers towards social sustainability requirements and the reciprocity of the latter's responses to them.

The Role of Precontractual Signals in Creating Sustainable Global Supply Chains

“…The concept of framing has been used extensively in social sciences to understand a wide range of topics, including collective action (Benford and Snow 2000), political communication (Scheufele 1999) and investment decisions (Giorgi and Weber 2015). Nevertheless, the concept is significantly underutilized within the sustainable supply chain literature (Soundararajan and Brammer 2018). By highlighting the role of framing as a channel through which precontractual signals can be effectively transmitted, we suggest the power of framing in contract performance in complex contexts like global supply chains.…”

“…Fourth, the extant research on sustainable global supply chains offers limited insights about the micro-level behavioral processes that are involved in the sustainability-related exchanges between lead firms and suppliers (Soundararajan and Brammer 2018). By emphasizing the importance of embedding interactional and communicative processes in the precontractual signaling process, we contribute to the emerging literature on the micro-processes of sustainable global supply chains.…”

“…Research suggests that the impact of existing measures to improve sustainability in global supply chains is limited (Locke et.al. 2009;Soundararajan and Brammer 2018). As sustainability expectations are often a part of contracts, and that the complexities of global supply chains impede contractual performance, poor implementation of the sustainable practices becomes a significant risk.…”

“…We narrow this scholarly gap by developing a process of how precontractual signals by the lead firm and supplier can facilitate the development of sustainable global supply chains. We leverage the role of framing, the organization and presentation of information to emphasize a current or desired state of existence (Soundararajan and Brammer 2018;Giorgi and Weber 2015), as a signaling channel. We show that, unlike environments of contractual performance and remedy, framing is amplified in precontractual environments where trust perceptions remain fluid, anticipation of future returns is strong, and prior contractual experience with one another has yet to influence the emerging relation.…”

Behavioral Operations and Supply Chain Management–A Review and Literature Mapping

“…A focus on sustainable supply chain practices is another emerging topic in behavioral buyer–supplier relations that specifically studies behavioral anomalies of supply chain decisionmakers and employees in adopting sustainability‐related strategies (Cantor, Morrow, & Montabon, ; Kirchoff, Omar, & Fugate, ) and how a new logic and culture rooted in cognition can encourage supply chains to move down the sustainability path (Montabon, Pagell, & Wu, ). In a recent study, Soundararajan and Brammer () investigate how intermediaries’ framing of social sustainability requirements affects sub‐suppliers’ perception of fairness and their positive or negative reciprocation.…”