An Alternative Paradigm of Managing Sustainability in the Global Supply Chain

Abstract

Based five year field work (2006-2011) in China, the author interviewed 30 Chinese executives from 20 different foreign multinational enterprises. Only two companies chose to practice more communication with their suppliers despite interests in operational efficiency. Exemplifying an alternative paradigm of managing sustainability based on thorough understandings through change of their organizational culture and relationships with their selected Chinese suppliers. Their commitment to sustainability in the global supply chain is due to the moral consciousness of their leaders and the persistence, compassion, and humbleness of their dedicated corporate social responsibility officers. There are five major barriers for managing sustainability in the global supply chain in China: seeking low cost and production efficiency; lacking internal alignments between commercial and responsible supply chain objectives; lacking incentives to practice procedural justice or develop trusting relationships with their suppliers in China in which there is weak legal enforcement system and civil society; easily bypassing many social and environmental responsibilities in China; and evasive compliance-oriented mechanism (i.e., monitoring, evaluating, reporting and sanctioning) over Chinese suppliers. Pursuing sustainability under the existing low-cost operational efficiency paradigm cannot overcome these five barriers. Managing sustainability in the global supply chain must be driven by the spirit of caring people and environment.