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Learning Sustainability? Absorptive capacities as drivers of sustainability in MNCs’ purchasing

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  • Riikkinen, Rilana
  • Kauppi, Katri
  • Salmi, Asta

Abstract

MNCs are expected to operate in a sustainable fashion. Implementation of sustainability requires the ability to acknowledge external (sustainability-related) knowledge, and to apply it in intra-company activities such as purchasing. We focus on absorptive capacities as potential drivers of sustainability, and investigate the effect that a purchasing function’s capacity to absorb and process knowledge has on social and environmental sustainability practices, and subsequently on economic performance in purchasing. We compare MNCs and non-MNCs using a structural equation model of a large set of survey data from four European countries and find that only realized absorptive capacities impact sustainability practices in purchasing and this impact is smaller in MNCs than in other companies. We suggest that companies respond to the demand for sustainability by strengthening their implementation capabilities: the potential to acquire and transform knowledge within a purchasing function is less relevant, and what matters is its application.

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  • Riikkinen, Rilana & Kauppi, Katri & Salmi, Asta, 2017. "Learning Sustainability? Absorptive capacities as drivers of sustainability in MNCs’ purchasing," International Business Review, Elsevier, vol. 26(6), pages 1075-1087.
    • Handle: RePEc:eee:iburev:v:26:y:2017:i:6:p:1075-1087
    DOI: 10.1016/j.ibusrev.2017.04.001
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