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Emerging roles of lead buyer governance for sustainability across global production networks

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  • Alexander, Rachel

Abstract

Global production networks (GPNs) connect multiple producers involved in fragmented manufacturing processes. Major brands and retailers, considered as lead firms, are under increasing pressure to ensure products made through GPNs are produced sustainably. Theories of governance developed to understand dynamics in outsourced production can provide insight into this issue. However, these theories and related empirical research have often focused on relationships between lead firms and upper-tier suppliers. When manufacturing involves multiple fragmented stages, understanding the role of lead firms becomes more difficult. This article considers new governance roles that lead firms, as buyers, are playing when attempting to promote sustainable practices across all stages of production for buyer-driven industries. The focus is exploring the nature of new governance approaches which lead firms have developed in order to address diverse sustainability challenges found within GPNs, particularly related to lower-tier suppliers. These approaches can involve lead firms working through vertical buyer–seller links or developing new horizontal relationships, which link lead firms with lower-tier suppliers and governance processes in these suppliers’ local productive systems. The findings draw from field research examining how top UK garment retailers provide governance to producers involved in creating cotton garments in India and a review of publicised policies and practices of these retailers related to promoting sustainable production. Five types of governance mechanisms that can involve vertical or horizontal links are identified. Considering the growth of new governance relationships expands previous conceptions of the roles of lead firm governance.

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  • Alexander, Rachel, 2020. "Emerging roles of lead buyer governance for sustainability across global production networks," LSE Research Online Documents on Economics 100908, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:100908
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    File URL: http://eprints.lse.ac.uk/100908/
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    5. Bimal Arora & Arno Kourula & Robert Phillips, 2020. "Emerging Paradigms of Corporate Social Responsibility, Regulation, and Governance: Introduction to the Thematic Symposium," Journal of Business Ethics, Springer, vol. 162(2), pages 265-268, March.
    6. Jamalnia, Aboozar & Gong, Yu & Govindan, Kannan, 2023. "Sub-supplier's sustainability management in multi-tier supply chains: A systematic literature review on the contingency variables, and a conceptual framework," International Journal of Production Economics, Elsevier, vol. 255(C).
    7. Valentina Marchi & Gary Gereffi, 2023. "Using the global value chain framework to analyse and tackle global environmental crises," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 50(1), pages 149-159, March.
    8. Vivek Soundararajan, 2023. "The dark side of the cascading compliance model in global value chains," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 50(1), pages 209-218, March.
    9. Fontana, Enrico & Öberg, Christina & Poblete, León, 2021. "Nominated procurement and the indirect control of nominated sub-suppliers: Evidence from the Sri Lankan apparel supply chain," Journal of Business Research, Elsevier, vol. 127(C), pages 179-192.
    10. Enrico Fontana & Muhammad Atif & Ammar Ali Gull, 2021. "Corporate social responsibility decisions in apparel supply chains: The role of negative emotions in Bangladesh and Pakistan," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 28(6), pages 1700-1714, November.
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    More about this item

    Keywords

    global production networks; governance; sustainable production;
    All these keywords.

    JEL classification:

    • N0 - Economic History - - General
    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General

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