How Does the Contingent Sustainability–Risk–Cost Relationship Affect the Viability of CSR? An Emerging Economy Perspective

Abstract

Sustainability has become a core strategic initiative for firms in the global economy. Its key benefits aside, sustainability may increase a firm’s risks, undermining its prospective value. The intricate relationship among sustainability’s impact on various dimensions of firm risk is poorly understood, particularly for firms operating in emerging economies. The purpose of this study is to address this gap by developing a nuanced framework for the sustainability–risk relationship in various industries in emerging economies. A multi-method approach was used to collect both quantitative and qualitative data through interviews and site visits for supply chain members of four industries. A fuzzy AHP method was used to illustrate cross-industry differences in sustainability-induced firm risks. These differences are further illustrated through inductive, interpretive analysis of semi-structured interviews. Sustainability behaves as a limits-to-growth system and engenders different risk profiles across four industries. For all firms in emerging economy, sustainability initiatives increase various unanticipated risks. Thus, these firms must saliently tailor sustainability initiatives uniquely suitable for their industry to avoid compromising their value proposition. Insights gleaned from this study may assist both buyers from multinational corporations in the developed economy to propagate sustainability initiatives and suppliers in the emerging economy to implement sustainability initiatives more saliently.

Integrating sustainability and resilience in the supply chain: A systematic literature review and a research agenda

“…Theoretical relationships and building (Theory): Several approaches to integrate sustainability and resilience have been introduced. In many cases, the traditional triple bottom line dimensions of sustainability have been broadened to other constructs that have been becoming increasingly important, such as risk and knowledge (Closs et al, 2011; Göçer et al, 2018, 2019). Nevertheless, more holistic approaches have been recommended given the complexity and urgency of sustainability (Fiksel, 2006).…”

Organizational unlearning: A risky food safety strategy?

“…Shorter, localized supply chains are not necessarily less risky; they can add complexity and fragmentation and can require increased resources for verification (Torres, 2016). Göçer et al (2019) describe this as a sustainability-riskcost relationship as on the one hand implementing more sustainable supply chain standards is a strategic response to reducing reputational risk, but on the other hand the increased costs involved in a highly competitive market are in themselves a risk. Additionally, the procurement of inherently higher food safety risk materials from a constrained supply base can lead to greater food safety risk exposure.…”

“…Naturally raised pork was first sourced in 2000, naturally raised chicken in 2002, zero trans‐fat frying oil in 2004, and sour cream and cheese from pasture‐fed cattle in 2012, and in 2015 genetically modified organisms have been eliminated from food ingredients (Gilliard et al., 2017). However, it is suggested that implementing this strategy meant that existing and new suppliers struggled with the unlearning, relearning, and learning aspects of the change (Göçer et al., 2019). While there is a depth of research focused on consumer food safety knowledge and its mediating effect on purchasing intention and purchasing behavior, that is, business to consumer (B2C), there is less published evidence on either the role of knowledge in business to business (B2B) procurement interaction or the association of knowledge management practices and risk in unlearning processes in procurement.…”

Transportation Makes Modern Retail “Click”: Research Questions for the Future

“…Beyond motivating the development of secondary markets, a second question that remains to be answered pertains to contemporary logistics challenges that are certain to repeat. Extant research suggests that sustainability efforts may be subject to both risk and cost constraints (Göçer, Jin, and Fawcett 2019). The COVID-19 pandemic and US-China trade war have resulted in rapidly shifting and evolving manufacturing base around the globe.…”