Exploring the use of governance mechanisms in multi-tier sustainable supply chains

Abstract

The extension of purchasing and supply chain management practices to reach upstream suppliers is critical in ensuring supply chain sustainability and requires the implementation of governance mechanisms. In this study, we investigate the mechanisms used by firms to ensure sustainability in multi-tier supply chains and how this use differs between the supply chain tiers. A multiple case study was conducted using semi-structured interview data from 25 companies covering three supply chain tiers. We identified 12 different governance mechanisms, the classification of which we suggest be based on their structure and purpose. While some differences were found regarding the specific practices used by individual firms, the overall findings indicate no major differences in terms of sustainability management efforts between the supply chain tiers. Thus, in contrast to previous studies, we show that lower-tier suppliers are active in the innovation and facilitation of supply chain sustainability. Also, the results confirm that firms often delegate the responsibility of ensuring sustainability to their direct suppliers.