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The Dark Side of Buyer Power: Supplier Exploitation and the Role of Ethical Climates

Author

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  • Martin C. Schleper

    (EBS University for Business and Law)

  • Constantin Blome

    (University of Sussex)

  • David A. Wuttke

    (EBS University for Business and Law)

Abstract

Media increasingly accuse firms of exploiting suppliers, and these allegations often result in lurid headlines that threaten the reputations and therefore business successes of these firms. Neither has the phenomenon of supplier exploitation been investigated from a rigorous, ethical standpoint, nor have answers been provided regarding why some firms pursue exploitative approaches. By systemically contrasting economic liberalism and just prices as two divergent perspectives on supplier exploitation, we introduce a distinction of common business practice and unethical supplier exploitation. Since supplier exploitation is based on power, we elucidate several levels of power as antecedents and investigate the role of ethical climate as a moderator. This study extends Victor and Cullen’s (1988) ethical climate matrix according to a supply chain dimension and is summarized in an integrated, conceptual model of five propositions for future theory testing. Results provide a frame of reference for executives and scholars, who can now delineate unethical exploitation and understand important antecedents of the phenomenon better.

Suggested Citation

  • Martin C. Schleper & Constantin Blome & David A. Wuttke, 2017. "The Dark Side of Buyer Power: Supplier Exploitation and the Role of Ethical Climates," Journal of Business Ethics, Springer, vol. 140(1), pages 97-114, January.
    • Handle: RePEc:kap:jbuset:v:140:y:2017:i:1:d:10.1007_s10551-015-2681-6
    DOI: 10.1007/s10551-015-2681-6
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    Cited by:

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    3. Schleper, Martin C. & Blome, Constantin & Stevenson, Mark & Thürer, Matthias & Tusell, Iu, 2022. "When it’s the slaves that pay: In search of a fair due diligence cost distribution in conflict mineral supply chains," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 164(C).
    4. Sini Laari & Tomi Solakivi & Anu Bask & Juuso Töyli & Lauri Ojala, 2021. "Unravelling Mickey Mouse: The Effect of Supply Chain Position and Organisational Slack on the Uneven Balance of Sustainability Dimensions," Sustainability, MDPI, vol. 13(24), pages 1-16, December.
    5. Kisha Lashley & Timothy G. Pollock, 2020. "Dancing with Giants: How Small Women- and Minority-Owned Firms Use Soft Power to Manage Asymmetric Relationships with Larger Partners," Organization Science, INFORMS, vol. 31(6), pages 1313-1335, November.
    6. Paul F. Skilton & Ednilson Bernardes, 2022. "Normal misconduct in the prescription opioid supply chain," Journal of Supply Chain Management, Institute for Supply Management, vol. 58(4), pages 6-29, October.
    7. Minelle E. Silva & Breno Nunes, 2022. "Institutional logic for sustainable purchasing and supply management: Concepts, illustrations, and implications for business strategy," Business Strategy and the Environment, Wiley Blackwell, vol. 31(3), pages 1138-1151, March.
    8. Richard Glavee-Geo & Per Engelseth & Arnt Buvik, 2022. "Power Imbalance and the Dark Side of the Captive Agri-food Supplier–Buyer Relationship," Journal of Business Ethics, Springer, vol. 178(3), pages 609-628, July.
    9. Mohammad Alghababsheh & David Gallear & Mushfiqur Rahman, 2020. "Balancing the Scales of Justice: Do Perceptions of Buyers’ Justice Drive Suppliers’ Social Performance?," Journal of Business Ethics, Springer, vol. 163(1), pages 125-150, April.
    10. Angus Robson, 2022. "Aquinas’s Principle of Misericordia in Corporations: Implications for Workers and other Stakeholders," Humanistic Management Journal, Springer, vol. 7(2), pages 233-257, October.
    11. Constantin Blome & Stephan Manning & Martin C. Schleper, 2022. "The contest for value in global value chains: Correcting for distorted distribution in the global apparel industry," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(8), pages 1836-1840, October.
    12. Seongtae Kim & Sangho Chae & Stephan M. Wagner & Jason W. Miller, 2022. "Buyer abusive behavior and supplier welfare: An empirical study of truck owner–operators," Journal of Supply Chain Management, Institute for Supply Management, vol. 58(4), pages 90-111, October.
    13. Kelsey M. Taylor & Eugenia Rosca, 2023. "Sink, swim, or drift: How social enterprises use supply chain social capital to balance tensions between impact and viability," Journal of Supply Chain Management, Institute for Supply Management, vol. 59(2), pages 62-86, April.
    14. András Miklós, 2019. "Exploiting Injustice in Mutually Beneficial Market Exchange: The Case of Sweatshop Labor," Journal of Business Ethics, Springer, vol. 156(1), pages 59-69, April.

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