Implementing Supplier Codes of Conduct in Global Supply Chains: Process Explanations from Theoretic and Empirical Perspectives |
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Authors: | Bin Jiang |
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Affiliation: | (1) Department of Management, DePaul University, 1 E Jackson Blvd., ste 7000, Chicago, IL, 60604, U.S.A. |
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Abstract: | Western buying companies impose Supplier Codes of Conduct (SCC) on their suppliers in developing countries; however, many suppliers cannot fully comply with SCC and some of them even cheat in SCC. In this research, we link contract characteristics – price pressure, production complexity, contract duration – to the likelihood of supplier’s commitment to SCC through a mediating process: how the buying companies govern their suppliers. Our structural equation model analysis shows that the hierarchy/relational norms governance is a perfect mediator of contract characteristics’ effects on the likelihood of supplier’s commitment; the market governance, an insignificant one. The managerial implications are provided for successfully implementing SCC in global supply chains. |
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Keywords: | supplier codes of conduct interorganizational governance transaction cost economics structural equation model mediating process |
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