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Equity as armor: Building unbreakable supply chains through strategic ownership

Author

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  • Huo, Peiyun
  • Wang, Shihuan
  • Qin, Dongqian

Abstract

This paper examines the imperative to enhance supply chain resilience in the face of growing global uncertainties, as conventional supply chain models are vulnerable to pandemics, geopolitical crises, and market volatility. This study, which utilizes data from 2017 to 2024, illustrates that augmented supply chain shareholding significantly improves resilience by reducing information asymmetry and lessening resource dependence. Equity ownership aligns incentives and formalizes information exchange, thereby promoting transparency, trust, and collaborative risk management, which diminishes opportunistic behavior and enables proactive responses to disruptions. Simultaneously, it provides focal firms with greater control over essential resources, converting arm's-length transactions into integrated networks that support coordinated investments in redundancy strategies, such as dual sourcing and shared logistics infrastructure. This research emphasizes strategic ownership as a crucial mechanism for developing adaptable, collaborative supply chain ecosystems that can withstand global uncertainty.

Suggested Citation

  • Huo, Peiyun & Wang, Shihuan & Qin, Dongqian, 2025. "Equity as armor: Building unbreakable supply chains through strategic ownership," Finance Research Letters, Elsevier, vol. 86(PE).
    • Handle: RePEc:eee:finlet:v:86:y:2025:i:pe:s1544612325019920
    DOI: 10.1016/j.frl.2025.108738
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    References listed on IDEAS

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