The impact of supply chain due diligence practices on supply chain performance: an organization’s perception

Abstract

PurposeThe increasing complexity and globalization of supply chains raise risks such as human rights abuses and environmental damage while affecting their supply chain performance (SCP), which prompted a study on supply chain due diligence (SCDD) practices. This study examines the impact of SCDD practices on the SCP. It examines if and how these relationships can be influenced by factors such as organizational culture and trust.Design/methodology/approachA conceptual model and hypotheses based on institutional theory were developed. The survey instrument captures organizations' perceptions of SCDD practices and related key performance indicators for SCP. The study collects data from 329 supply chain and logistics managers in Indian manufacturing and logistics organizations, and the hypotheses are validated using a structural equation model.FindingsResults indicate that SCDD practices positively influence SCP. Trust and organizational culture strengthened SCDD–SCP relationships.Practical implicationsThe study explores how organizations perceive and implement due diligence in their supply chains, highlighting areas for improvement. This understanding could help organizations enhance their supply chain management strategies, leading to better risk management, cost reduction, avoiding penalties and improved overall performance.Originality/valueThe main contribution of the study is to examine organizations' perceptions of SCDDA implementation and then identify its effects on supply chain performance. This is done considering trust and organizational culture as moderating factors.