Drivers of Green Supply Chain Management Practices and their Impact on Firm Performance: A Developing Country Perspective
Abstract
The purpose of this paper is to identify the drivers of Green Supply Chain Management (GSCM) practices among the manufacturing firms of a developing country, and to examine the impact of GSCM practices on firms’ economic and environmental performance. A structural equation model is developed to study the hypothesized relationships between three drivers and GSCM practices. Furthermore, the relationship between GSCM practices and firm’s economic and environmental performance is also investigated. A sample of manufacturing firms is taken from the companies listed in the local stock exchange. Cross-sectional data of 80 responses from these manufacturing firms is collected. The developed model is tested through Partial Least Square Structural Equation Modeling (PLS-SEM) technique. Results show that customer’s pressure and firm’s internal drive (enviropreneurship) positively impacts the adoption of GSCM practices whereas the relationship between governmental legislation GSCM practices adoption is not significant. GSCM practices positively impact the supply chain buying firm’s economic and environmental performance.
Downloads
References
Agi, M. A., & Nishant, R. (2017). Understanding influential factors on implementing green supply chain management practices: An interpretive structural modelling analysis. Journal of environmental management, 188, 351-363.
Ameer, R., Othman,R. (2012). Sustainability practices and corporate financial performance: a study based on the top global corporations. Journal of business ethics, 108(1), 61-79.
Aslam, M. M. H., & Azhar, S. M. (2013, 15th-16th February). Globalization & Development: Challenges for Developing Countries. Paper presented at the SIBR Conference on Interdisciplinary Business and Economics Research, Kuala Lumpur.
Azevedo, S. G., Carvalho, H., & Machado, V. C. (2011). The influence of green practices on supply chain performance: a case study approach. Transportation research part E: logistics and transportation review, 47(6), 850-871.
Bai, C., & Sarkis, J. (2010). Green supplier development: analytical evaluation using rough set theory. Journal of cleaner production, 18(12), 1200-1210.
Ball, A., Craig,R. (2010). .Using neo-institutionalism to advancesocial and environmental accounting. Critical Perspectives on Accounting, 21(4), 283–293.
Beamon, B. M. (1999). Designing the green supply chain. Logistics information management, 12(4), 332-342.
Behnam, M., & MacLean, T. L. (2010). Where Is the Accountability in International Accountability Standards? Business Ethics Quarterly, 21(1), 45-72.
Bendul, J. C., Rosca, E., & Pivovarova, D. (2017). Sustainable supply chain models for base of the pyramid. Journal of Cleaner Production, 162, S107-S120.
Boyer, K. K., Prud’homme, A.M. and Chung, W. (2009). The last mile challenge: evaluating the effects of customer density and delivery window patterns. Journal of Business Logistics, 30(1), 185-202.
Campbell, J. L. (2007). Why would corporations behave in socially responsible ways? An institutional theory of corporate social responsibility. Academy of Management Review, 32(3), 946-967.
Carr, A. S., Leong, G. K., & Sheu, C. (2000). A study of purchasing practices in Taiwan. International Journal of Operations & Production Management, 20(12), 1427-1446.
Carter., C. R., & Carter, J. R. (1998). Interorganizational determinants of environmental purchasing: initial evidence from the consumer products industries*. Decision Sciences, 29(3), 659-684.
Chan, R. Y. (2010). Corporate environmentalism pursuit by foreign firms competing in China. Journal of World Business, 45(1), 80-92.
Chien, M. K.(2014). Influences of Green Supply Chain Management Practices on Organizational Sustainable Performance. International Journal of Environmental Monitoring and Protection, 1(1), 12.
Chien, M. K., & Shih, L. H.(2007). An empirical study of the implementation of green supply chain management practices in the electrical and electronic industry and their relation to organizational performances. International Journal of Environmental Science and Technology, 4(3), 383-394.
Christmann, P., & Taylor, G. (2001). Globalization and the environment: Determinants of firm self-regulation in China. Journal of international business studies, 32(3), 439-458.
Dimaggio, P. , Powell,W.(1983). The ironcage revisited:institutional isomorphism and collective rationality in organizational fields. American Sociological Review, 48(2), 147–160.
Dogl, C., & Behnam, M. (2014). Environmentally sustainable development through stakeholder engagement in developed and emerging countries. Business Strategy and the Environment,24(6), 583-600.
Fernandes, V. (2012). (Re) Discovering the PLS approach in management science. M@ n@ gement, 15(1).
Florida, R. (1996). The environment and the new industrial revolution. California Management Review, 38 (Autumn), , 80-115.
Frodell, M. (2011). Criteria for achieving efficient contractor-supplier relations. Engineering, Construction and Architectural Management, 18(4), 381-393.
Geffen, C., & Rothenberg, S. (2000). Sustainable development across firm boundaries: the critical role of suppliers in environmental innovation. International Journal of Operations & Production Management, 20(2), 166-186.
Govindan, K., Sarkis, J., Jabbour, C. J. C., Zhu, Q., & Geng, Y. (2014). Eco-efficiency based green supply chain management: current status and opportunities. European Journal of Operational Research, 233(2), 293-298.
Haenlein, M., & Kaplan, A. M. (2004). A beginner's guide to partial least squares analysis. Understanding Statistics, 3(4), 283-297.
Harris, P. G. (2006). Environmental Perspectives and Behavior in China Synopsis and Bibliography. Environment and Behavior, 38(1), 5-21.
Hitchcock, T. (2012). Low carbon and green supply chains: the legal drivers and commercial pressures. Supply Chain Management: An International Journal, 17(1), 98-101.
Holt, D., & Ghobadian, A. (2009). An empirical study of green supply chain management practices amongst UK manufacturers. Journal of Manufacturing Technology Management, 20(7), 933-956.
Hsu, P. F., Hu, P. J. H., Wei, C. P., & Huang, J. W. (2014). Green Purchasing by MNC Subsidiaries: The Role of Local Tailoring in the Presence of Institutional Duality. Decision Sciences, 45(4), 647-682.
Innes, R., & Sam, A. G. (2008). Voluntary pollution reductions and the enforcement of environmental law: An empirical study of the 33/50 program. Journal of Law and Economics, 51(2), 271-296.
Irani, Z., Kamal, M. M., Sharif, A., & Love, P. E. (2017). Enabling sustainable energy futures: Factors influencing green supply chain collaboration. Production Planning & Control, 28(6-8), 684-705.
Islam, S., Karia, N., Fauzi, F. B. A., & Soliman, M. (2017). A review on green supply chain aspects and practices. Management & Marketing, 12(1), 12-36.
Jayaraman, V., Klassen, R. and Linton, J.D. (2007). Supply chain management in a sustainable environment Journal of Operations Management, 25, 1071-1074.
Jones, C. (2010). Exploring new ways of assessing the effect of regulation on environmental management. Journal of cleaner production, 18(13), 1229-1250.
Khidir ElTayeb, T., Zailani, S., & Jayaraman, K. (2010). The examination on the drivers for green purchasing adoption among EMS 14001 certified companies in Malaysia. Journal of Manufacturing Technology Management, 21(2), 206-225.
Kilbourne, W. E., Beckmann,S.C.,Thelen,E. (2002). The role of the dominant social paradigm in environmental attitudes:a multinational examination. Journal of Business Research, 55(3), 193–204.
Kimber, D., & Lipton, P. (2005). Corporate governance and business ethics in the Asia-Pacific region. Business & Society, 44(2), 178-210.
Koh, S. L., Gunasekaran, A., Morris, J., Obayi, R., & Ebrahimi, S. M.(2017). Conceptualizing a circular framework of supply chain resource sustainability. International Journal of Operations & Production Management, 37(10), 1520-1540.
Kumar, S., Hong, Q. S., & Haggerty, L. N. (2011). A global supplier selection process for food packaging. Journal of Manufacturing Technology Management, 22(2), 241-260.
Laari, S., Töyli, J., & Ojala, L. (2017). Supply chain perspective on competitive strategies and green supply chain management strategies. Journal of Cleaner Production, 141, 1303-1315.
Lai, K. H., & Wong, C. W. (2012). Green logistics management and performance: Some empirical evidence from Chinese manufacturing exporters. Omega, 40(3), 267-282.
Lai, K. H., Cheng, T. C. E., & Tang, A. K. (2010). Green retailing: factors for success. California Management Review, 52(2), 6-31.
Lee, C., Lee, K., & Pennings, J. M. (2001). Internal capabilities, external networks, and performance: study on technology-based ventures. Strategic Management Journal 22(6-7), 615-640.
Lee, K. H., & Cheong, I. M. (2011). Measuring a carbon footprint and environmental practice: the case of Hyundai Motors. Industrial Management & Data Systems, 111(6), 961-978.
Lee, S. M., Tae Kim, S., & Choi, D. (2012). Green supply chain management and organizational performance. Industrial Management & Data Systems, 112(8), 1148-1180.
Lee, S. Y. (2008). Drivers for the participation of small and medium-sized suppliers in green supply chain initiatives. Supply Chain Management: An International Journal, 13(3), 185-198.
Linton, J. D., Jayaraman, V. (2005). A framework for identifying differences and similarities in the managerial competencies associated with different modes of product life extension. International Journal of Production Research, 43(9), 1807-1829.
Lounsbury, M. (1997). Exploring the institutional toolkit: the rise of recycling in the U.S.solidwaste field.American Behavioral Scientist, , 40(4), 465–477.
Luthra, S., Garg, D., & Haleem, A. (2016). The impacts of critical success factors for implementing green supply chain management towards sustainability: an empirical investigation of Indian automobile industry. Journal of Cleaner Production, 121, 142-158.
Maignan, I., & Ferrell, O.C. (2001). Antecedents and benefits of corporate citizenship: an investigation of French businesses. Journal of Business Research, 51(1), 37-51.
Mar Miras‐Rodriguez, M., Carrasco‐Gallego, A., & Escobar‐Perez, B. (2013). Are socially responsible behaviors paid off equally? A cross‐cultural analysis. Corporate Social Responsibility and Environmental Management,22(4), 237-256.
Mathivathanan, D., Kannan, D., & Haq, A. N. (2017). Sustainable supply chain management practices in Indian automotive industry: A multi-stakeholder view. Resources, Conservation and Recycling, 128, 284-305.
Mefford, R. N. (2011). The economic value of a sustainable supply chain. Business and Society Review, 116(1), 109-143.
Menon, A., & Menon, A. (1997). Enviropreneurial marketing strategy: the emergence of corporate environmentalism as market strategy. The Journal of Marketing,61(1), 51-67.
Meyer, J. W., & Rowan, B. (1977). Institutionalized organization: for malstructure as myth and ceremony. American Journal of Sociology, 83(2), 340–363.
North, D. C. (1990). Institutions,Institutional change,and Economic Performance. Cambridge,UK: Cambridge University Press,.
Pan, J.N. (2003). A comparative study on motivation for and experience with ISO 9000 and ISO 14000 certification among Far Eastern countries. Industrial Management & Data Systems, 103(8), 564-578.
Park, S. H., Chen, R. R., & Gallagher, S. (2002). Firm resources as moderators of the relationship between market growth and strategic alliances in semiconductor start-ups. Academy of Management Journal, 45(3), 527-545.
Paulraj, A. (2011). Understanding the relationships between internal resources and capabilities, sustainable supply management and organizational sustainability. Journal of Supply Chain Management, 47(1), 19-37.
Peng, D. X., & Lai, F. (2012). Using partial least squares in operations management research: A practical guideline and summary of past research. Journal of Operations Management, 30(6), 467-480.
Rao, P., & Holt, D. (2005). Do green supply chains lead to competitiveness and economic performance? International Journal of Operations & Production Management, 25(9), 898-916.
Rao, P. (2002). Greening the supply chain: a new initiative in South East Asia. International Journal of Operations & Production Management, 22(6), 632-655.
Rivera, J. (2004). Institutional pressures and voluntary environmental behavior in developing countries:evidence from the Costa Rican hotel industry. Society and Natural Resources, 17 (9), 779–797.
Roehrich, J. K., Hoejmose, S. U., & Overland, V. (2017). Driving green supply chain management performance through supplier selection and value internalisation: a self-determination theory perspective. International Journal of Operations & Production Management, 37(4), 489-509.
Sari, K. (2017). A novel multi-criteria decision framework for evaluating green supply chain management practices. Computers & Industrial Engineering, 105, 338-347.
Sarkis, J. (1995). Manufacturing strategy and environmental consciousness. Technovation, 15(2), 79-97.
Sarkis, J. (2012). A boundaries and flows perspective of green supply chain management. Supply Chain Management: An International Journal, 17(2), 202-216.
Schecterle, R., & Senxian, J. (2008). Building a Green Supply Chain: Social Responsibility for Fun and Profit. Aberdeen Group.
Shultz, C. J., & Holbrook, M. B. (1999). Marketing and the tragedy of the commons: A synthesis, commentary, and analysis for action. Journal of Public Policy & Marketing,8(2) 218-229.
Vijayvargy, L., Thakkar, J., & Agarwal, G. (2017). Green supply chain management practices and performance: The role of firm-size for emerging economies. Journal of Manufacturing Technology Management, 28(3), 299-323.
Wolf, J. (2011). Sustainable supply chain management integration: A qualitative analysis of the german manufacturing industry. Journal of Business Ethics, 102(2), 221-235.
Wong, C. W., Lai, K. H., Shang, K. C., Lu, C. S., & Leung, T. K. P. (2012). Green operations and the moderating role of environmental management capability of suppliers on manufacturing firm performance. International journal of production economics, 140(1), 283-294.
Wu, G. C., Ding, J. H., & Chen, P. S. (2012). The effects of GSCM drivers and institutional pressures on GSCM practices in Taiwan’s textile and apparel industry. International Journal of Production Economics, 135(2), 618-636.
Xie, Y., & Breen, L.(2012). Greening community pharmaceutical supply chain in UK: a cross boundary approach. Supply Chain Management: An International Journal, 17(1), 40-53.
Youn, S., Yang, M. G. M., Hong, P., & Park, K. (2013). Strategic supply chain partnership, environmental supply chain management practices, and performance outcomes: an empirical study of Korean firms. Journal of Cleaner Production, 56, 121-130.
Zailani., S., Eltayeb, T., Hsu, C.-C., & Tan, K. C. (2012). The impact of external institutional drivers and internal strategy on environmental performance. International Journal of Operations & Production Management, 32(6), 721-745.
Zeng, S. X., Meng, X.H., Zeng, R.C., Tam, C.M., V. W., & Jin, T. (2011). How environmental management driving forces affect environmental and economic performance of SMEs: a study in the Northern China district. Journal of cleaner production, 19(13), 1426-1437.
Zhu, Q., & Sarkis, J. (2004). Relationships between operational practices and performance among early adopters of green supply chain management practices in Chinese manufacturing enterprises. Journal of Operations Management, 22(3), 265-289.
Zhu, Q., Cordeiro, J., &Sarkis, J. (2013).Institutional pressures, dynamic capabilities and environmental management systems: investigating the ISO 9000–Environmental management system implementation linkage. Journal of environmental management, 114, 232-242.
Zhu, Q., Geng, Y., Sarkis, J., & Lai, K. H. (2011). Evaluating green supply chain management among Chinese manufacturers from the ecological modernization perspective. Transportation Research Part E: Logistics and Transportation Review, 47(6), 808-821.
Zhu, Q., Qu, Y., Geng, Y., & Fujita, T. (2017). A comparison of regulatory awareness and green supply chain management practices among Chinese and Japanese manufacturers. Business Strategy and the Environment, 26(1), 18-30.
Zhu, Q., Sarkis, J., & Lai, K..H (2013). Institutional-based antecedents and performance outcomes of internal and external green supply chain management practices. Journal of Purchasing and Supply Management, 19(2), 106-117.
Zhu, Sarkis, J., & Lai, K. H. (2007). Green supply chain management: pressures, practices and performance within the Chinese automobile industry. Journal of Cleaner Production, 15(11/12), 1041-1052.
Zhu. Q., & Liu, Q. (2010). Eco-design planning in a Chinese telecommunication network company: benchmarking its parent company. Benchmarking: An International Journal, 17(3), 363-377.
Zhu. Q., Sarkis, J., & Lai, K.H (2008). Confirmation of a measurement model for green supply chain management practices implementation. International Journal of Production Economics, 111(2), 261-273.
Zhu., Q., Geng, Y., Sarkis, J., & Lai, K. H. (2011). Evaluating green supply chain management among Chinese manufacturers from the ecological modernization perspective. Transportation Research Part E: Logistics and Transportation Review, 47(6), 808-821.
JQM follows an open-access publishing policy and full text of all published articles is available free, immediately upon publication of an issue. The journal’s contents are published and distributed under the terms of the Creative Commons Attribution 4.0 International (CC-BY 4.0) license. Thus, the work submitted to the journal implies that it is original, unpublished work of the authors (neither published previously nor accepted/under consideration for publication elsewhere). On acceptance of a manuscript for publication, a corresponding author on the behalf of all co-authors of the manuscript will sign and submit a completed Copyright and Author Consent Form.