Climate policies in supply chains?
Climate policies in supply chains?
Using granular firm-level disclosures, we show suppliers adopt climate action and governance policies following customer firms' adoption of emission reduction targets. Such transmissions are driven by relative bargaining power rather than through a reconfiguration of customers' supply chains. However, we do not find any effect on suppliers' emissions or its leading indicators. This policy-outcome gap suggests a green-washing motive in suppliers’ adoption of climate policies. The policy-outcome gap is lower when suppliers have higher gross margins, and customers can better monitor suppliers. Our results imply that better commercial terms in supply chain contracts can reduce greenwashing concerns.
Social Science Research Network
Homroy, Swarnodeep
bf9526ca-76e9-4d1f-8b8e-0be867b684f1
Rauf, Asad
4140c39d-f49d-4fb5-9c03-44438bd1bedd
13 May 2023
Homroy, Swarnodeep
bf9526ca-76e9-4d1f-8b8e-0be867b684f1
Rauf, Asad
4140c39d-f49d-4fb5-9c03-44438bd1bedd
Homroy, Swarnodeep and Rauf, Asad
(2023)
Climate policies in supply chains?
Social Science Research Network
66pp.
(doi:10.2139/ssrn.4446166).
Record type:
Monograph
(Working Paper)
Abstract
Using granular firm-level disclosures, we show suppliers adopt climate action and governance policies following customer firms' adoption of emission reduction targets. Such transmissions are driven by relative bargaining power rather than through a reconfiguration of customers' supply chains. However, we do not find any effect on suppliers' emissions or its leading indicators. This policy-outcome gap suggests a green-washing motive in suppliers’ adoption of climate policies. The policy-outcome gap is lower when suppliers have higher gross margins, and customers can better monitor suppliers. Our results imply that better commercial terms in supply chain contracts can reduce greenwashing concerns.
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Published date: 13 May 2023
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Local EPrints ID: 499358
URI: http://eprints.soton.ac.uk/id/eprint/499358
PURE UUID: f03987d9-e864-408c-a264-7c48c78752a7
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Date deposited: 18 Mar 2025 17:30
Last modified: 26 Apr 2025 02:14
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Author:
Swarnodeep Homroy
Author:
Asad Rauf
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