Sustainability in multi-tier supply chains: Understanding the double agency role of the first-tier supplier |
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| Institution: | 1. University of Groningen, Faculty of Economics and Business, Global Economics & Management, Nettelbosje 2, 9747 AE Groningen, The Netherlands;2. University of Sussex, School of Business, Management and Economics, Falmer, Brighton BN1 9SL, UK;3. The University of Melbourne Faculty of Business & Economics, Victoria 3010, Australia;4. The University of Manchester, Alliance Manchester Business School, Booth Street West, Manchester, M15 6PB, UK;1. Oregon State University, College of Business, 422 Austin Hall, Corvallis, OR 97331-2603, United States;2. Portland State University, School of Business Administration, P.O. Box 751, Portland, OR 97232-0751, United States;1. Head of Marketing Oncology, Merck Serono GmbH, Darmstadt, Germany;2. Professor for Procurement & Quality Management, University of Applied Sciences Aschaffenburg, Germany;3. Professor of Logistics and Quantitative Methods, Julius-Maximilians-University Würzburg, Germany;4. Research Associate Chair of International Marketing, University of Vienna, Austria;5. Professor of Supply Chain & Operations Management, Mainz University of Applied Sciences, Lucy-Hillebrand-Str. 2, 55128, Mainz, Germany;6. Visiting Professor at Department of Strategy & Innovation, Copenhagen Business School (CBS), Denmark;1. Faculty of Economics and Business, University of Groningen, Nettelbosje 2, 9747 AE, Groningen, The Netherlands;2. Faculty of Business, The Hong Kong Polytechnic University, 1 Yuk Choi Road, Hung Hom, Kowloon, Hong Kong;3. Antai College of Economics and Management, Shanghai Jiao Tong University, 1954 Huashan Rd, Shanghai 20030 PR China;4. School of Economics and Management, Shanghai Maritime University, Shanghai, 201306, PR China;5. Sino-US Global Logistics Institute, Shanghai Jiao Tong University, 1954 Huashan Rd, Shanghai 20030, PR China;1. ESADE Business School, Universitat Ramon Llull, Avda. Torreblanca 59, 08172, Sant Cugat del Vallès, Barcelona, Spain;2. The Hong Kong Polytechnic University, Institute of Textiles and Clothing, Hunghom, Kowloon, Hong Kong;3. ESADE Business School, Universitat Ramon Llull, Avda. Torreblanca 59, 08172, Sant Cugat del Vallès, Barcelona, Spain |
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| Abstract: | In light of the growing complexity of globally dispersed, multi-tier supply chains, the involvement of first-tier suppliers has become instrumental in the quest for achieving sustainability compliance along the supply chain. We describe this new responsibility as the double agency role. We employ agency and institutional theory arguments to explore the conditions under which first-tier suppliers will act as agents who fulfill the lead firm's sustainability requirements (i.e., the primary agency role) and implement these requirements in their suppliers' operations (i.e., the secondary agency role). The findings from three in-depth case studies embedded in different institutional contexts highlight the importance for lead firms to incentivize each agency role separately and to reduce information asymmetries, particularly at the second-tier level. In addition, our inductive analysis reveals several contingency factors that influence the coupling of the secondary agency role of the first-tier supplier. These factors include resource availability at the first-tier supplier's firm, the lead firm's focus on the triple-bottom-line dimension (i.e., environmental or social), the lead firm's use of power, and the lead firm's internal alignment of the sustainability and purchasing function. We integrate our findings in a conceptual framework that advances the research agenda on multi-tier sustainable supply chains, and we subsequently outline the practical implications of assigning the double agency role to first tier suppliers. |
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| Keywords: | Sustainable supply chain management Multi-tier supply chains Double-agency Agency theory |
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