Global Supply-Chain Networks and Corporate Social Responsibility

71 Pages Posted: 18 Dec 2017 Last revised: 26 Jul 2018

See all articles by Christoph Schiller

Christoph Schiller

Arizona State University (ASU) - W.P. Carey School of Business

Date Written: April 1, 2018

Abstract

This paper examines the role of supply-chain relationships for the transmission of corporate Environmental and Social (E&S) policies, and the resulting impact on real E&S outcomes and firm performance. I show that E&S policies propagate from customers to suppliers, especially when customers have higher bargaining power and suppliers are in countries with lower ESG standards. This transmission mechanism matters: suppliers subsequently reduce their toxic emissions, litigation and reputation risk decreases, and financial performance improves. I use staggered E&S regulation changes around the world to establish causality. Global supply-chains act as a transmission mechanism for regulatory requirements and standards across borders.

Keywords: Corporate Social Responsibility, ESG, Sustainability, International Supply-Chains, Customers and Suppliers

JEL Classification: F30, F36, G38, Q50

Suggested Citation

Schiller, Christoph, Global Supply-Chain Networks and Corporate Social Responsibility (April 1, 2018). 13th Annual Mid-Atlantic Research Conference in Finance (MARC) Paper. Available at SSRN: https://ssrn.com/abstract=3089311 or http://dx.doi.org/10.2139/ssrn.3089311

Christoph Schiller (Contact Author)

Arizona State University (ASU) - W.P. Carey School of Business ( email )

Tempe, AZ 85287-3706
United States

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