Next Article in Journal
Bottled Water: An Evidence-Based Overview of Economic Viability, Environmental Impact, and Social Equity
Previous Article in Journal
Can “Smart Homework” Achieve the Goal of Chinese “Double Reduction” Policy to Reduce Burden and Improve Quality?—The Positive and Negative Effects of “Smart Homework” on Students
 
 
Search for Articles:
Title / Keyword
Author / Affiliation / Email
Journal
Article Type
 
 
Advanced Search
 
Section
Special Issue
Volume
Issue
Number
Page
 
Journals
Sustainability
Volume 15
Issue 12
10.3390/su15129757
sustainability-logo
Submit to this Journal Review for this Journal Propose a Special Issue
► Article Menu

Article Menu

share Share announcement Help format_quote Cite question_answer Discuss in SciProfiles thumb_up
...
Endorse textsms
...
Comment
first_page
settings
Order Article Reprints
Font Type:
Arial Georgia Verdana
Font Size:
Aa Aa Aa
Line Spacing:
Column Width:
Background:
Article

Linking Sustainable Supplier Selection to Firm’s Sustainable Performance: The Moderated Mediating Role of Supplier Development and Leadership for Functional Integration

by
Zhigang Fan
1,* and
Tae-Won Kang
2,*
1
Alibaba Business School, Hangzhou Normal University, Hangzhou 311121, China
2
Department of Supply Chain and Logistics, College of Social Sciences, Kunsan National University, Gunsan 54150, Republic of Korea
*
Authors to whom correspondence should be addressed.
Sustainability 2023, 15(12), 9757; https://doi.org/10.3390/su15129757
Submission received: 30 March 2023 / Revised: 16 June 2023 / Accepted: 18 June 2023 / Published: 19 June 2023
(This article belongs to the Section Sustainable Management)
Browse Figures
Review Reports Versions Notes

Abstract

:
This study aims to investigate the moderated mediation model in which leadership support for functional integration complements sustainable supplier selection to enhance a firm’s sustainability performance by promoting sustainable supplier development practices. We tested the proposed hypothesis using 289 data collected from multiple sources of manufacturing firms. Our results reveal that sustainable supplier selection indirectly enhances a firm’s sustainability performance via sustainable supplier development practices. In addition, our results highlight that leadership support for functional integration strengthens this indirect relationship. This study contributes to the sustainability management literature by providing insights into how firms promote sustainability performance by combining leadership with sustainable supplier management.

1. Introduction

Sustainable development that integrates environmental and social issues with economic aspects has been an increasingly important issue to academic researchers and business practitioners [1,2]. The external and internal pressures arising from sustainable concerns change the traditional supply chain into a sustainable supply chain that pursues sustainability goals [3,4]. Furthermore, since long-term sustainable development creates numerous business opportunities to enhance competitiveness by seeking new markets and value-added solutions, firms have paid more attention to developing sustainability performance in the supply chain [5]. Sustainability performance refers to achieving the triple bottom line, including environmental, social, and economic performance [6]. The environmental performance takes into account efficiency in resource recycling and reduction of pollution and waste. Social performance concerns human rights and labor practices. Economic performance means operational and financial performance, such as quality, cost, delivery, and revenue performance [7]. Given the increasing importance of sustainability issues, supply chain researchers have also investigated the antecedents of sustainability performance from the perspective of sustainable supplier management.
When managing sustainability, it is difficult for buying firms to guarantee their sustainability without ensuring their suppliers’ sustainability. Researchers have found that sustainable supplier selection and assessment practices positively affect environmental and social performance [8,9,10]. Furthermore, collaborative practices with supply chain partners can improve firms’ sustainability performance [11,12,13,14,15,16]. Previous studies highlighted that sustainable supplier management is a vital enabler for achieving the desired sustainability performance by focusing on supplier selection, evaluation, and collaboration. In addition, the literature on sustainable supplier management started focusing on sustainable supplier development because the suppliers’ ability to manage sustainability can directly impact the focal firms’ sustainability performance [17,18]. Sustainable supplier development practices refer to the buying firm’s initiative practices to improve sustainable supplier performance or capability to meet two or more elements of the triple bottom line, which involves economic, environmental, and social performance [19,20,21]. Fan, Xiao, Zhang and Guo [16] found that sustainable supplier development could improve firms’ sales performance by enhancing customer satisfaction. Sancha, et al. [22] emphasized that implementing supplier development practices enables the suppliers to be more socially responsible. Researchers also tried to provide appropriate processes for sustainable supplier development to guide practitioners to improve the suppliers’ capability of achieve environmental and social performance [23,24]. However, relatively few researchers examined the antecedents of sustainable supplier development. For instance, Sancha, et al. [25] examined how institutional pressures (i.e., coercive, regulatory, and normative) influence the adoption of sustainable supplier development. Although much research has focused on sustainable supplier management, there is still a lack of understanding of how sustainable supplier development is encouraged and facilitated. This study examines the antecedent and consequences of sustainable supplier development to fill this research gap. Specifically, according to the resource-based perspective [26,27], our study focuses on enhancing sustainability performance by exploring how sustainable supplier selection facilitates a firm’s sustainability performance via sustainable supplier development practices. Although sustainable supplier selection is necessary to obtain the critical resources for sustainability, little is known about its mechanism for improving the buying firms’ sustainable performance. Furthermore, according to the knowledge management perspective [28], the sustainable supplier selection process generates information about supplier capabilities through supplier assessment and evaluation, which helps to implement the appropriate sustainable supplier development practices. The knowledge and information flow from sustainable supplier selection enhances the knowledge sharing about sustainability and further promotes sustainability performance in the complicated business context. Therefore, this study investigates the indirect mechanism that links sustainable supplier selection to sustainable performance via sustainable supplier development practices.
Furthermore, considering the importance of functional integration in the supply chain [29], our study proposes that leadership support for functional integration moderates the relationship between sustainable supplier selection and development practices. Functional integration within the organization is needed to meet the requirements of the buying firm, but diversity and differences between individuals with different functions result in conflict and problems. Up to this point, the role of leadership has been crucial for functional integration [30,31]. When leaders support functional integration through communication and encouragement, individuals are more likely to respond to the different aspects and knowledge, which leads to increasing resources and knowledge sharing. According to the knowledge management perspective, knowledge sharing and flow strengthen the relationship between sustainable supplier selection and sustainable development practices. Moreover, the interaction effect of sustainable supplier selection and leadership support for functional integration may transmit to sustainability performance via sustainable supplier development practices. Figure 1 shows the conceptual research model of this study.
Overall, our study attempts to contribute to the literature on sustainable supplier management in some ways. First, our study adds to the evidence of the importance of sustainability links in the supply chain, including sustainable supplier selection and development practices. Second, our study suggests a mechanism that links sustainable supplier selection to sustainability performance via sustainable supplier development practices. Finally, by examining the moderated mediation model in which leadership support for functional integration has a moderating role, our study provides new insights for implementing sustainable supplier management more effectively.

2. Hypotheses Development

2.1. Mediating Role of Supplier Development in the Relationship between Supplier Selection and Sustainable Performance

Supplier selection and evaluation is the first stage of supplier management [32]. When the performance of an existing supplier is not enough to meet the buyer’s requirement, it is necessary to evaluate new suppliers and identify their capability to select anew. Traditionally, supplier selection focuses on economic-based values such as cost, quality, and delivery times [33,34]. However, recently it has started to consider the importance of environmental and social issues [20,35,36,37,38]. In this study, sustainable supplier selection refers to the process of identifying, evaluating, and selecting the appropriate suppliers for sustainability [39]. According to the resource-based view, supplier selection provides the key resources for improving the buying firm’s performance [40]. When the buying firm identifies and selects an appropriate supplier with particular capabilities and expertise and effectively integrates the obtained supplier’s capabilities with its own, the supplier’s capabilities can be a source of the buying firm’s competitive advantage. Furthermore, when the resources from the sustainable supplier are scarce and non-substitutable for the buying firm’s specific sustainable needs, it provides better value and competence for the sustainability of the buying firm.
Although the sustainable supplier has the potential to provide valuable resources, in an uncertain business environment, it is necessary to continuously develop the supplier’s capabilities and performance for the buying firm’s long-term sustainable goals. Given the uncertainty and costs of searching for new suppliers, the buying firm needs to improve the performance and capabilities of the supplier to achieve their competitive advantage through supplier development practices [32,41,42]. Furthermore, since the buying firm makes more effort to select a sustainable supplier, it will likely pay more attention to developing its capabilities and performance. On the other hand, when choosing suitable suppliers for sustainability, it is essential to assess their capabilities and performance for advancing the sustainable goals of the buying firm [43,44]. The buying firm selects sustainable suppliers through evaluation and certification before initiating sustainable supplier development practices and then identifying where supplier development efforts are needed [41]. According to the knowledge management perspective, the supplier selection process provides valuable information for implementing supplier development practices to improve the suppliers’ performance and capabilities in line with the buying firms’ objectives and reduce early supplier risk through clear assessment [45,46]. Therefore, sustainable supplier selection with evaluation and certification for sustainability facilitates sustainable supplier development practices by providing valuable information for the supplier’s needed improvements.
Since sustainable supplier development practices are designed for the buying firm’s sustainability requirements, well-implemented sustainable supplier development is helpful for both suppliers and buyers to improve sustainability performance. Sustainable supplier development practices can help the supplier consider achieving environmental and social goals by providing technological support and professional personnel regarding environmental and social issues [20,47,48]. Increasing visits and problem-solving assistance facilitate the transfer of specific knowledge for better performance [46,49]. A close relationship and collaboration between supplier and buyer through sustainable supplier development practices can help with the adoption and development of environmental technologies, improving environmental performance and increasing economic performance by reducing operational costs and creating new business opportunities [50,51]. Moreover, sustainable supplier development practices enable the sharing of valuable knowledge with social standards for sustainability and enhancing social performance for both the supplier and the buyer [52]. Indeed, researchers have found that sustainable supplier development can improve economic [53,54], environmental [45,51,55], and social performance [51,56]. In sum, from the knowledge management perspective, the initiatives and actions such as communication, information sharing, and personal assistance that the buying firm provides can enhance the sustainability performance of both supplier and the buying firm. In other words, the capabilities and performance of sustainable suppliers improved by a buyer’s sustainable supplier development practices can contribute to the sustainability performance of the buying firm. The more effort the buying firm puts into selecting suppliers for sustainability, the more likely the buying firm will put effort into initiating sustainable supplier development practices. Then, sustainable supplier development practices facilitate the capability and performance of suppliers through technical assistance and personal support with specific knowledge and resources of sustainability, which contribute to the buying firm’s sustainability performance [40]. Therefore, we posit that sustainable supplier development practices mediate the relationship between sustainable supplier selection and the buying firm’s sustainability performance.
H1: 
Sustainable supplier selection indirectly enhances a firm’s sustainability performance by facilitating sustainable supplier development practices.

2.2. Moderating Role of Leadership Support for Functional Integration

Functional integration focuses on the coordination or information sharing among different functions [31,57]. Information sharing and coordination enhance technical improvements and increase individual commitment and motivation, advancing the firm’s performance [58]. Furthermore, functional integration uses diverse resources and information from different functions for a specific project with more creative thinking and brings out benefits for their common goals. Functional integration in the supply chain especially leads to the success of the firm’s overall strategy for quality and innovation [59,60] and enhances sustainable competitiveness [61].
However, the diversity and differences between individuals from different functional areas can easily create conflicts and stress. The ambiguity of roles and resources also incurs difficulties in achieving high performance. Therefore, leadership is critical to the success of functional integration. The leader can promote functional integration by using communication and resolving conflicts. The leadership support for functional integration can break away from existing knowledge sources and competition and help to explore new sources and competitiveness. When leadership supports functional integration, information and knowledge are more likely to be shared, which leads to seeking a better way for unstable environments [62]. As a dynamic capability, functional integration supported by leadership facilitates the transformation of disparate knowledge and information into integrated resources, enhancing the firm’s performance [63].
According to the knowledge management perspective, knowledge generation and sharing are critical in sustainability development [28]. Since functional integration facilitates the sharing of information and the generation of creative ideas, exploring new markets and products for sustainability is beneficial, leading to more sustainable development for the supplier. When leaders pay more attention and make more effort to achieve functional integration, the information and knowledge obtained through sustainable supplier selection are more likely to be used in sustainable supplier development. Therefore, leadership support for functional integration interplay with sustainable supplier selection and more efficiently enhances sustainable supplier development practices. Furthermore, leadership support for functional integration may strengthen the indirect effect of sustainable supplier selection on sustainability performance via sustainable supplier development practices.
The leadership support for functional integration also breaks down functional barriers and facilitates communication, coordination, and collaboration among various functional departments [31,64]. Sustainable supplier selection and development practices require cross-functional collaboration [17,25,42]. By leveraging the functional collaboration and expertise of different functions, firms can perform more comprehensive supplier assessments, enhancing the effectiveness of sustainable supplier selection in promoting sustainable supplier development.
In addition, leadership support for functional integration helps various functional departments align with business strategies. Previous studies emphasized that sustainable supply chain management requires an alignment of shared goals, visions, and strategies across different functions [65,66,67]. Leadership support for functional integration may play an important role in facilitating the positive relationship between sustainable supplier selection and development practices by leveraging shared goals, visions, and strategies among functions, subsequently enhancing sustainable performance. Thus, we suggest that leadership support for functional integration strengthens the indirect effect of sustainable supplier selection on sustainability performance via sustainable supplier development practices.
H2: 
Leadership support for functional integration moderates the indirect effect of sustainable supplier selection on a firm’s sustainability performance via sustainable supplier management practices, such that the indirect effect is stronger when the leadership support for functional integration is high.

3. Methods and Results

3.1. Data Collection and Measurement

We used the data set from the fourth round of the High-Performance Manufacturing (HPM) project to examine the proposed moderated mediation hypothesis. Researchers from 15 countries and regions have joined this project to collect survey data specializing in three manufacturing industries (i.e., machinery, electronics, and transportation). The survey questionnaire was developed in English. Then, researchers translated it into each local language and went through a back-translation process to ensure the accuracy of the translation. Recent literature has described the data collection process of the HPM project [68]. One of the authors in this study also participated in the data collection process. A total of 330 plants submitted responses. After dropping 32 responses due to missing data, we used 289 samples to conduct regression analysis.
The measurements of our major constructs were adapted from existing literature. To measure sustainable supplier selection, 3 items were adapted from Mousavi and Mousavi [69] by focusing on supplier selection criteria based on environmental and social factors. Four items for sustainable supplier development practices were adapted from Picasso, et al. [70] and Wang, et al. [71]. According to Epstein and Widener [72], sustainability performance was measured using the four items in terms of economic, environmental, and social aspects. The four items for leadership support for functional integration were adopted from Morita, et al. [73]. All items were framed using the Likert 5-point scale. Table 1 presents all the constructs and the measurement items.
In addition, several control variables (i.e., firm size, R&D intensity, brand image, and industry factor) were included in the research model. We measured firm size using the natural logarithm of the number of employees. R&D intensity was measured by the percentage of sales spent on R&D, from a 1 (i.e., significantly lower than leading competitors) to a 5 (i.e., significantly higher than leading competitors). The brand image was measured by positioning the brand image of the products relative to those of leading competitors, from a 1 (i.e., significantly lower) to a 5 (i.e., significantly higher). Lastly, machinery and electronics were included in the form of dummy variables.

3.2. Reliability and Validity

Table 2 presents the exploratory factor analysis (EFA), including the major constructs of this study: sustainable supplier development practices (SSDP), sustainable performance (SP), leadership support for functional integration (LSFI), and sustainable supplier selection (SSS). The EFA extracted four factors, explaining 63.245% of the total variance. In addition, as shown in Table 3, Cronbach’s α and composite reliability values of all the constructs were higher than 0.7, indicating good construct reliability. Then, we conducted a confirmatory factor analysis (CFA) to test convergent validity. CFA results revealed that all the constructs showed acceptable fit (χ2/df = 1.741, RMSEA = 0.051; CFI = 0.971; TLI = 0.945; GFI = 0.936; NFI = 0.903), and factor loadings were significant and greater than 0.535 (see Table 1). Table 3 also shows that the average variance extracted (AVE) values were above 0.611 and larger than the squared correlation coefficient of each construct, ensuring convergent and discriminant validity.

3.3. Analysis Results

Hypothesis 1 proposed that sustainable supplier development practices (SSDP) mediate the relationship between sustainable supplier selection (SSS) and sustainable performance (SP). Table 4 shows the regression results. The results show that sustainable supplier selection positively affects sustainability performance (β = 0.095, p < 0.05; Model 4). The results of Model 2 indicate that sustainable supplier selection has a significantly positive effect on sustainable supplier development practices (b = 0.277, p < 0.001). In Model 4, the impact of sustainable supplier selection on sustainability performance positively affects sustainability performance (b = 0.095, p < 0.05). However, after controlling the direct effect of sustainable supplier selection in Model 5, the direct effect is weakened and insignificant, while sustainable supplier development practices are positively associated with sustainability performance ((b = 0.275, p < 0.001). These results indicate that sustainable supplier development practices fully mediate the relationship between sustainable supplier selection and sustainable performance, supporting Hypothesis 1.
Hypothesis 2 proposed the moderated mediation effect in which the indirect effect of sustainable supplier selection on sustainability performance via sustainable supplier development practices would be moderated by leadership support for functional integration. As shown in Table 4, the interaction effect of sustainable supplier selection and leadership support for functional integration (LSFI) on sustainable supplier development practices is positive and significant (b = 0.293, p < 0.001; Model 3). Figure 2 also shows that the effect of sustainable supplier selection (SSS) on sustainability performance is stronger as the leadership support for functional integration increases. Then, we used the PROCESS macro model 7 to test the moderated mediation effect. As shown in Table 5, the moderated mediation index is significant (index = 0.043, 95% BC CI: [0.011, 0.085]). The results also show that the indirect effects are strengthened as the leadership support for functional integration increases. Figure 3 provides evidence of the conditional indirect effect of sustainable supplier selection on sustainability performance via sustainable supplier development practices at different levels of leadership support for functional integration. These results support Hypothesis 2.

4. Discussion

Based on the resource-based view and knowledge management perspective, this study empirically examined a moderated mediation model in which we investigated how leadership support for functional integration and sustainable supplier selection jointly impact sustainable supplier development that further influences sustainability performance. Our results revealed that the effect of sustainable supplier selection transfers to sustainability performance through sustainable supplier development practices. In addition, leadership support for functional integration moderated this indirect effect, such that the indirect impact of sustainable supplier selection on sustainability performance via sustainable supplier development practices was more substantial for high levels of leadership support for functional integration.

4.1. Implications for Research

The results of this study expand our understanding of how firms leverage sustainable supplier selection and development to promote their sustainable performance more effectively. First, our findings confirm previous studies emphasizing the vital role of sustainable supplier development practices in promoting buying firms’ sustainable performance [23,24,75]. The general supplier development literature is well documented as an effective way to benefit buyers and suppliers in terms of improved supplier performance [76] and focal firms’ operational performance [17,77]. Similarly, the results of this study show that sustainable supplier development is positively associated with buying firms’ sustainable performance, leading to improvements in environmental, social, and economic performance. In line with previous studies, our findings provide evidence that sustainable supplier development practices (e.g., buying firms’ technological support, financial investment, and personnel training to enhance their suppliers’ capability in managing sustainability) can increase suppliers’ motivation and capabilities in satisfying buying firms’ sustainability requirements, thereby resulting in improved sustainability performance.
Second, our findings contribute to sustainable supplier management literature by affirming that sustainable supplier development practices mediate the relationship between sustainable supplier selection and sustainable performance. Supplier development is viewed as an integrative mechanism that provides technical assistance and collaboration to suppliers after selecting suppliers and positively impacts the buying firm’s performance [21,40]. This study introduces sustainable supplier development practices as an intermediate mechanism linking sustainable supplier selection to sustainable performance. According to the knowledge management perspective, our findings suggest that sustainable development practices triggered by sustainable supplier selection are more likely to promote the buying firms’ sustainability performance by transferring and sharing valuable knowledge for sustainability. Our findings support the critical role of sustainable supplier management in sustainability by combining sustainable supplier selection with subsequent sustainable supplier development practices.
Finally, this study reveals that the mediating effect of sustainable supplier development practices varies depending on the level of leadership support for functional integration. Although many researchers have found functional integration’s various benefits and barriers [60], few have investigated the moderating role of leadership for functional integration in a sustainable supply chain. This study fills a gap in the literature by examining the moderating role of leadership support for functional integration in the relationship between sustainable supplier selection, sustainable supplier development practices, and sustainable performance. We found that leadership support for functional integration strengthens the indirect effect of sustainable supplier selection on sustainability performance via sustainable development practices. According to the knowledge management perspective, generating and integrating knowledge through functional integration promote the transportation of the knowledge flow from sustainable supplier selection to enhance sustainability performance via sustainable development practices. The results of this study expand our understanding of the important leadership role in implementing sustainable supplier management more effectively.

4.2. Implications for Practice

Manufacturing firms are increasingly considering not only low cost, best quality, and on-time delivery but also environmental and social issues to maintain their competitiveness [39]. Our findings also provide such manufacturers with some practical implications. First, selecting the appropriate sustainable supplier is an essential factor influencing sustainability performance. Therefore, manufacturing firms should make more effort to design and implement sustainable supplier selection processes by considering economic, environmental, and social criteria. Second, our findings suggest that sustainable supplier development is a mediator through which sustainable supplier selection indirectly influences sustainable performance. Thus, manufacturing firms need to develop and improve their suppliers’ sustainable capabilities to transfer sustainable supplier selection benefits to sustainable performance more efficiently. In other words, manufacturing firms must prioritize sustainable supplier selection and development as their supplier management strategy to improve sustainability performance. Third, regarding the importance of knowledge and information in sustainable supplier management, the leadership should pay more attention to functional integration. Functional integration would not only facilitate the knowledge flow from the supplier selection process to supplier development but also enhance the motivation and satisfaction of members by resolving conflicts from different functions, thereby strengthening the effectiveness of sustainable supplier management. By leveraging the leadership roles in promoting functional integration, firms can implement sustainable supplier selection more effectively to improve sustainable performance via sustainable supplier development.

5. Conclusions

This study investigates the leadership role in influencing indirect mechanisms linking sustainable supplier selection to sustainable performance via sustainable supplier development. The results of this study show that leadership support for functional integration plays an important role in managing supplier sustainability more effectively, resulting in a more sustainable performance. Although our study found that sustainable supplier selection enables the buying firm’s sustainable supplier development practices and sustainable performance, other potential antecedents may exist, such as specific investment, power dependence, and the firm’s policy. Future research might explore which factors promote sustainability in the supply chain to expand our understanding of what drives and how to implement sustainable supplier management. Additionally, this study used the data collected from buying firms. Future research is needed to involve suppliers’ standpoints and examine the effectiveness of implementing sustainable development practices. Furthermore, the moderated mediation mechanism of our study needs to be examined in various contexts, such as firm, team, and individual characteristics, to improve the effectiveness of sustainable supplier management.

Author Contributions

Conceptualization, Z.F. and T.-W.K.; methodology, T.-W.K.; writing—original draft preparation, Z.F. and T.-W.K.; writing—review and editing, Z.F.; funding acquisition, Z.F. All authors have read and agreed to the published version of the manuscript.

Funding

This research was funded by the Humanities and Social Sciences Research Planning Fund Project of the Ministry of Education, grant number 20YJA630013, National Social Science Fund of China, grant number 21BGL119 and Zhejiang Provincial Department of Science and Technology, grant number 2023C25024.

Institutional Review Board Statement

Not applicable.

Informed Consent Statement

Not applicable.

Data Availability Statement

The data will be available from the corresponding author upon reasonable request.

Acknowledgments

The authors thank Mingu Kang for providing data resources and valuable comments.

Conflicts of Interest

The authors declare no conflict of interest.

References

  1. Rajeev, A.; Pati, R.K.; Padhi, S.S.; Govindan, K. Evolution of sustainability in supply chain management: A literature review. J. Clean. Prod. 2017, 162, 299–314. [Google Scholar] [CrossRef]
  2. Gil-Doménech, D.; Magomedova, N.; Sánchez-Alcázar, E.J.; Lafuente-Lechuga, M. Integrating Sustainability in the Business Administration and Management Curriculum: A Sustainability Competencies Map. Sustainability 2021, 13, 9458. [Google Scholar] [CrossRef]
  3. Taghikhah, F.; Voinov, A.; Shukla, N. Extending the supply chain to address sustainability. J. Clean. Prod. 2019, 229, 652–666. [Google Scholar] [CrossRef]
  4. Zhu, W.; Wang, Z. The Collaborative Networks and Thematic Trends of Research on Purchasing and Supply Management for Environmental Sustainability: A Bibliometric Review. Sustainability 2018, 10, 1510. [Google Scholar] [CrossRef] [Green Version]
  5. Wilding, R.; Wagner, B.; Gimenez, C.; Tachizawa, E.M. Extending sustainability to suppliers: A systematic literature review. Supply Chain Manag. 2012, 17, 531–543. [Google Scholar]
  6. Alhaddi, H. Triple bottom line and sustainability: A literature review. Bus. Manag. Stud. 2015, 1, 6–10. [Google Scholar] [CrossRef]
  7. Koberg, E.; Longoni, A. A systematic review of sustainable supply chain management in global supply chains. J. Clean. Prod. 2019, 207, 1084–1098. [Google Scholar] [CrossRef]
  8. Ciliberti, F.; de Groot, G.; de Haan, J.; Pontrandolfo, P. Codes to coordinate supply chains: SMEs’ experiences with SA8000. Supply Chain Manag. Int. J. 2009, 14, 117–127. [Google Scholar] [CrossRef]
  9. Murray, J.G. Effects of a green purchasing strategy: The case of Belfast City Council. Supply Chain Manag. Int. J. 2000, 5, 37–44. [Google Scholar] [CrossRef]
  10. Large, R.O.; Thomsen, C.G. Drivers of green supply management performance: Evidence from Germany. J. Purch. Supply Manag. 2011, 17, 176–184. [Google Scholar] [CrossRef]
  11. Vachon, S.; Klassen, R.D. Environmental management and manufacturing performance: The role of collaboration in the supply chain. Int. J. Prod. Econ. 2008, 111, 299–315. [Google Scholar] [CrossRef]
  12. Schliephake, K.; Stevens, G.; Clay, S. Making resources work more efficiently—The importance of supply chain partnerships. J. Clean. Prod. 2009, 17, 1257–1263. [Google Scholar] [CrossRef]
  13. Borchardt, M.; Wendt, M.H.; Pereira, G.M.; Sellitto, M.A. Redesign of a component based on ecodesign practices: Environmental impact and cost reduction achievements. J. Clean. Prod. 2011, 19, 49–57. [Google Scholar] [CrossRef]
  14. Kang, M.; Yang, M.G.; Park, Y.; Huo, B. Supply chain integration and its impact on sustainability. Ind. Manag. Data Syst. 2018, 118, 1749–1765. [Google Scholar] [CrossRef]
  15. Gimenez, C.; Sierra, V.; Rodon, J. Sustainable operations: Their impact on the triple bottom line. Int. J. Prod. Econ. 2012, 140, 149–159. [Google Scholar] [CrossRef]
  16. Fan, D.; Xiao, C.; Zhang, X.; Guo, Y. Gaining customer satisfaction through sustainable supplier development: The role of firm reputation and marketing communication. Transp. Res. Part E Logist. Transp. Rev. 2021, 154, 102453. [Google Scholar] [CrossRef]
  17. Li, S.; Kang, M.; Haney, M.H. The effect of supplier development on outsourcing performance: The mediating roles of opportunism and flexibility. Prod. Plan. Control 2017, 28, 599–609. [Google Scholar] [CrossRef]
  18. Shou, Y.; Shao, J.; Lai, K.-h.; Kang, M.; Park, Y. The impact of sustainability and operations orientations on sustainable supply management and the triple bottom line. J. Clean. Prod. 2019, 240, 118280. [Google Scholar] [CrossRef]
  19. Bai, C.; Satir, A. A critical content-analysis of sustainable supplier development literature and future research directions. J. Clean. Prod. 2022, 365, 132443. [Google Scholar] [CrossRef]
  20. Yang, F.; Zhang, X. The impact of sustainable supplier management practices on buyer-supplier performance: An empirical study in China. Rev. Int. Bus. Strategy 2017, 27, 112–132. [Google Scholar] [CrossRef]
  21. Jia, M.; Stevenson, M.; Hendry, L. A systematic literature review on sustainability-oriented supplier development. Prod. Plan. Control 2023, 34, 727–747. [Google Scholar] [CrossRef]
  22. Sancha, C.; Gimenez, C.; Sierra, V.; Kazeminia, A. Does implementing social supplier development practices pay off? Supply Chain Manag. Int. J. 2015, 20, 389–403. [Google Scholar] [CrossRef]
  23. Rashidi, K.; Saen, R.F. Incorporating dynamic concept into gradual efficiency: Improving suppliers in sustainable supplier development. J. Clean. Prod. 2018, 202, 226–243. [Google Scholar] [CrossRef]
  24. Finger, G.S.W.; Lima-Junior, F.R. A hesitant fuzzy linguistic QFD approach for formulating sustainable supplier development programs. Int. J. Prod. Econ. 2022, 247, 108428. [Google Scholar] [CrossRef]
  25. Sancha, C.; Longoni, A.; Giménez, C. Sustainable supplier development practices: Drivers and enablers in a global context. J. Purch. Supply. Manag. 2015, 21, 95–102. [Google Scholar] [CrossRef]
  26. Hart, S.L.; Dowell, G. Invited editorial: A natural-resource-based view of the firm: Fifteen years after. J. Manag. 2011, 37, 1464–1479. [Google Scholar] [CrossRef]
  27. Armstrong, C.E.; Shimizu, K. A review of approaches to empirical research on the resource-based view of the firm. J. Manag. 2007, 33, 959–986. [Google Scholar] [CrossRef]
  28. Martins, V.W.B.; Rampasso, I.S.; Anholon, R.; Quelhas, O.L.G.; Leal Filho, W. Knowledge management in the context of sustainability: Literature review and opportunities for future research. J. Clean. Prod. 2019, 229, 489–500. [Google Scholar] [CrossRef]
  29. Lambert, D.M.; Cooper, M.C. Issues in supply chain management. Ind. Mark. Manag. 2000, 29, 65–83. [Google Scholar] [CrossRef]
  30. Zhao, F.; Kang, T.-W.; Kang, M. Linking Intellectual Leadership Practices to Sustainability Outcomes: Moderated Mediation Effect of Employees&rsquo; Multifunctionality. Sustainability 2022, 14, 3855. [Google Scholar]
  31. Kang, M.; Lee, G.; Hwang, D.W.; Wei, J.; Huo, B. Effects of cross-functional integration on NPD success: Mediating roles of customer and supplier involvement. Total Qual. Manag. Bus. Excell. 2021, 32, 1515–1531. [Google Scholar] [CrossRef]
  32. Hahn, C.K.; Watts, C.A.; Kim, K.Y. The supplier development program: A conceptual model. J. Purch. Mater. Manag. 1990, 26, 2–7. [Google Scholar] [CrossRef]
  33. Kannan, V.R.; Tan, K.C. Supplier Selection and Assessment: Their Impact on Business Performance. J. Supply. Chain. Manag. 2002, 38, 11–21. [Google Scholar] [CrossRef] [Green Version]
  34. Wetzstein, A.; Hartmann, E.; Benton, W.C., Jr.; Hohenstein, N.-O. A systematic assessment of supplier selection literature—State-of-the-art and future scope. Int. J. Prod. Econ. 2016, 182, 304–323. [Google Scholar] [CrossRef]
  35. Alkaabneh, F.M.; Lee, J.; Gómez, M.I.; Gao, H.O. A systems approach to carbon policy for fruit supply chains: Carbon tax, technology innovation, or land sparing? Sci. Total Environ. 2021, 767, 144211. [Google Scholar] [CrossRef]
  36. Alkaabneh, F.; Diabat, A. A multi-objective home healthcare delivery model and its solution using a branch-and-price algorithm and a two-stage meta-heuristic algorithm. Transp. Res. Part C Emerg. Technol. 2023, 147, 103838. [Google Scholar] [CrossRef]
  37. Balaguer-Mercado, A.; Kirshner, S.N.; Tseng, C.-L. Sustainable Supplier Selection under Financial Hardships: The Conflicting Impact of Spatial and Temporal Psychological Distances. Sustainability 2023, 15, 9561. [Google Scholar] [CrossRef]
  38. Tsai, J.-F.; Wu, S.-C.; Pham, T.K.L.; Lin, M.-H. Analysis of Key Factors for Green Supplier Selection: A Case Study of the Electronics Industry in Vietnam. Sustainability 2023, 15, 7885. [Google Scholar] [CrossRef]
  39. Zimmer, K.; Fröhling, M.; Schultmann, F. Sustainable supplier management—A review of models supporting sustainable supplier selection, monitoring and development. Int. J. Prod. Res. 2016, 54, 1412–1442. [Google Scholar] [CrossRef]
  40. Koufteros, X.; Vickery, S.K.; Dröge, C. The effects of strategic supplier selection on buyer competitive performance in matched domains: Does supplier integration mediate the relationships? J. Supply Chain Manag. 2012, 48, 93–115. [Google Scholar] [CrossRef]
  41. Humphreys, P.K.; Li, W.; Chan, L. The impact of supplier development on buyer–supplier performance. Omega 2004, 32, 131–143. [Google Scholar] [CrossRef]
  42. Lee, G.; Shin, G.-c.; Hwang, D.W.; Kuper, P.; Kang, M. How manufacturers’ long-term orientation toward suppliers influences outsourcing performance. Ind. Market. Manag. 2018, 74, 288–297. [Google Scholar] [CrossRef]
  43. Paulraj, A. Understanding the relationships between internal resources and capabilities, sustainable supply management and organizational sustainability. J. Supply. Chain. Manag. 2011, 47, 19–37. [Google Scholar] [CrossRef]
  44. Urbaniak, M.; Tundys, B.; Ankiel, M. Expectations of Production Companies Operating in Poland towards Suppliers with Regards to Implementation of the Sustainability Concept. Sustainability 2021, 13, 8683. [Google Scholar] [CrossRef]
  45. Yadlapalli, A.; Rahman, S.; Gunasekaran, A. Socially responsible governance mechanisms for manufacturing firms in apparel supply chains. Int. J. Prod. Econ. 2018, 196, 135–149. [Google Scholar] [CrossRef]
  46. Modi, S.B.; Mabert, V.A. Supplier development: Improving supplier performance through knowledge transfer. J. Oper. Manag. 2007, 25, 42–64. [Google Scholar] [CrossRef]
  47. Yang, M.G.; Kang, M. An integrated framework of mimetic pressures, quality and environmental management, and firm performances. Prod. Plan. Control 2020, 31, 709–722. [Google Scholar] [CrossRef]
  48. Sgarbossa, F.; Peron, M.; Fragapane, G. Cloud Material Handling Systems: Conceptual Model and Cloud-Based Scheduling of Handling Activities. In Scheduling in Industry 4.0 and Cloud Manufacturing; Sokolov, B., Ivanov, D., Dolgui, A., Eds.; Springer International Publishing: Cham, Switzerland, 2020; pp. 87–101. [Google Scholar]
  49. Yang, M.G.; Roh, J.J.; Kang, M. The role of strategic environmental orientation in environmental design practices. Manag. Decis. 2021, 59, 341–357. [Google Scholar] [CrossRef]
  50. Zhu, Q.; Sarkis, J.; Lai, K.-h. Initiatives and outcomes of green supply chain management implementation by Chinese manufacturers. J. Environ. Manag. 2007, 85, 179–189. [Google Scholar] [CrossRef]
  51. Gualandris, J.; Kalchschmidt, M. Developing environmental and social performance: The role of suppliers’ sustainability and buyer–supplier trust. Int. J. Prod. Res. 2016, 54, 2470–2486. [Google Scholar] [CrossRef]
  52. Subramaniam, P.L.; Iranmanesh, M.; Kumar, K.M.; Foroughi, B. The impact of multinational corporations’ socially responsible supplier development practices on their corporate reputation and financial performance. Int. J. Phys. Distrib. Logist. Manag. 2020, 50, 3–25. [Google Scholar] [CrossRef]
  53. Perez-Aleman, P.; Sandilands, M. Building value at the top and the bottom of the global supply chain: MNC-NGO partnerships. Calif. Manag. Rev. 2008, 51, 24–49. [Google Scholar] [CrossRef]
  54. Klassen, R.D.; McLaughlin, C.P. The impact of environmental management on firm performance. Manag. Sci. 1996, 42, 1199–1214. [Google Scholar] [CrossRef]
  55. Lee, S.Y.; Klassen, R.D. Drivers and enablers that foster environmental management capabilities in small-and medium-sized suppliers in supply chains. Prod. Oper. Manag. 2008, 17, 573–586. [Google Scholar] [CrossRef]
  56. Locke, R.; Amengual, M.; Mangla, A. Virtue out of necessity? Compliance, commitment, and the improvement of labor conditions in global supply chains. Politics Soc. 2009, 37, 319–351. [Google Scholar] [CrossRef]
  57. Troy, L.C.; Hirunyawipada, T.; Paswan, A.K. Cross-functional integration and new product success: An empirical investigation of the findings. J. Mark. 2008, 72, 132–146. [Google Scholar] [CrossRef]
  58. Ford, R.C.; Randolph, W.A. Cross-functional structures: A review and integration of matrix organization and project management. J. Manag. 1992, 18, 267–294. [Google Scholar] [CrossRef]
  59. Foerstl, K.; Hartmann, E.; Wynstra, F.; Moser, R. Cross-functional integration and functional coordination in purchasing and supply management: Antecedents and effects on purchasing and firm performance. Int. J. Oper. Prod. Manag. 2013, 33, 689–721. [Google Scholar] [CrossRef]
  60. Jeske, D.; Calvard, T.S. A review of the literature on cross-functional integration (2010–2020): Trends and recommendations. Int. J. Organ. Anal. 2021, 29, 401–414. [Google Scholar] [CrossRef]
  61. Narver, J.C.; Slater, S.F. The effect of a market orientation on business profitability. J. Mark. 1990, 54, 20–35. [Google Scholar] [CrossRef]
  62. Auh, S.; Menguc, B. The influence of top management team functional diversity on strategic orientations: The moderating role of environmental turbulence and inter-functional coordination. Int. J. Res. Mark. 2005, 22, 333–350. [Google Scholar] [CrossRef]
  63. Auh, S.; Menguc, B. Top management team diversity and innovativeness: The moderating role of interfunctional coordination. Ind. Mark. Manag. 2005, 34, 249–261. [Google Scholar] [CrossRef]
  64. Genç, E.; Di Benedetto, C.A. Cross-functional integration in the sustainable new product development process: The role of the environmental specialist. Ind. Market. Manag. 2015, 50, 150–161. [Google Scholar] [CrossRef]
  65. Carrim, I.; Agigi, A.; Niemann, W.; Mocke, K. The role of buyer-supplier relationships in enhancing sustainable supply chain management in a logistics services context. J. Contemp. Manag. 2020, 17, 150–182. [Google Scholar] [CrossRef]
  66. Bratt, C.; Sroufe, R.; Broman, G. Implementing strategic sustainable supply chain management. Sustainability 2021, 13, 8132. [Google Scholar] [CrossRef]
  67. Hallikas, J.; Lintukangas, K.; Kähkönen, A.-K. The effects of sustainability practices on the performance of risk management and purchasing. J. Clean. Prod. 2020, 263, 121579. [Google Scholar] [CrossRef]
  68. Ahmadi-Gh, Z.; Bello-Pintado, A. Why is manufacturing not more sustainable? The effects of different sustainability practices on sustainability outcomes and competitive advantage. J. Clean. Prod. 2022, 337, 130392. [Google Scholar] [CrossRef]
  69. Mousavi, M.D.; Mousavi, M.D. The Effect of Stakeholder’s Pressure on firm Market Performance and the Mediating Role of Corporate Responsibility, Sustainable Supplier Selection, and Marketing Capability. Corp. Reput. Rev. 2022, 1–13. [Google Scholar] [CrossRef]
  70. Picasso, F.G.; Biazzin, C.; Paiva, E.L.; Beal Partyka, R. Socially responsible supply chain initiatives and their outcomes: A taxonomy of manufacturing companies. Supply Chain Manag. Int. J. 2023, 28, 90–106. [Google Scholar] [CrossRef]
  71. Wang, Z.; Wang, Q.; Zhang, S.; Zhao, X. Effects of customer and cost drivers on green supply chain management practices and environmental performance. J. Clean. Prod. 2018, 189, 673–682. [Google Scholar] [CrossRef]
  72. Epstein, M.J.; Widener, S.K. Identification and use of sustainability performance measures in decision-making. J. Corp. Citizsh. 2010, 43–73. [Google Scholar] [CrossRef]
  73. Morita, M.; Machuca, J.A.; Flynn, E.J.; de los Ríos, J.L.P. Aligning product characteristics and the supply chain process—A normative perspective. Int. J. Prod. Econ. 2015, 161, 228–241. [Google Scholar] [CrossRef]
  74. ISO 14000; Family–Environmental Management. International Organization for Standardization (ISO): Geneva, Switzerland, 2019.
  75. Lo, S.M.; Zhang, S.; Wang, Z.; Zhao, X. The impact of relationship quality and supplier development on green supply chain integration: A mediation and moderation analysis. J. Clean. Prod. 2018, 202, 524–535. [Google Scholar] [CrossRef]
  76. Nagati, H.; Rebolledo, C. Supplier development efforts: The suppliers’ point of view. Ind. Market. Manag. 2013, 42, 180–188. [Google Scholar] [CrossRef]
  77. Carr, A.S.; Kaynak, H. Communication methods, information sharing, supplier development and performance: An empirical study of their relationships. Int. J. Oper. Prod. Manag. 2007, 27, 346–370. [Google Scholar] [CrossRef]
Sustainability 15 09757 g001 550
Figure 1. Conceptual research model.
Figure 1. Conceptual research model.
Sustainability 15 09757 g001
Sustainability 15 09757 g002 550
Figure 2. The moderating effect of leadership support for functional integration (LSFI).
Figure 2. The moderating effect of leadership support for functional integration (LSFI).
Sustainability 15 09757 g002
Sustainability 15 09757 g003 550
Figure 3. The presence of moderated mediation effect.
Figure 3. The presence of moderated mediation effect.
Sustainability 15 09757 g003
Table
Table 1. Construct measurement and confirmatory factor analysis.
Table 1. Construct measurement and confirmatory factor analysis.
ConstructLoading
Sustainable Supplier Selection
SSS1Environmental certification, such as ISO 14001 [74]0.850 ***
SSS2Ethical employment practices0.656 ***
SSS3Use of sustainability practices, such as recycling and reuse0.754 ***
Sustainable Supplier Development Practices
SSDP1Encouraging suppliers to improve the environmental performance of their processes0.906 ***
SSDP2Visiting suppliers’ plants or ensuring that they are not using sweatshop labor0.650 ***
SSDP3Providing design specifications to suppliers in line with environmental requirements (e.g., green purchasing, black list of raw materials)0.681 ***
SSDP4Co-development with suppliers to reduce the environmental impact of the product (e.g., eco-design, green packaging, recyclability)0.728 ***
Sustainability Performance
SP1Environmental performance0.705 ***
SP2Regulatory performance0.686 ***
SP3Revenue performance0.520 ***
SP4Corporate reputation/image0.771 ***
Leadership Support for Functional Integration
LSFI1Our top management emphasizes the importance of good inter-functional relationships.0.535 ***
LSFI2Our managers do a good job of solving inter-functional conflicts.0.704 ***
LSFI3We are encouraged to communicate well with different functions in this plant.0.683 ***
LSFI4Our managers communicate effectively with managers in other functions.0.655 ***
Significance level: *** p < 0.001.
Table
Table 2. EFA results.
Table 2. EFA results.
SSDPSPLSFISSS
SSS10.215−0.0350.1000.822
SSS20.102−0.0190.1130.798
SSS3−0.0500.1870.0810.644
SSDP10.8370.2700.0460.122
SSDP20.7810.0390.0670.113
SSDP30.6590.3150.1480.065
SSDP40.8060.1690.0840.003
SP10.1420.7820.165−0.035
SP20.0410.8160.0880.061
SP30.2910.539−0.0020.036
SP4 0.2770.766−0.0040.122
LSFI10.0400.0640.6760.070
LSFI20.1510.0390.7480.084
LSFI30.0880.0470.7730.008
LSFI40.0010.0800.7520.162
Table
Table 3. Descriptive analyses, reliability, and validity.
Table 3. Descriptive analyses, reliability, and validity.
Construct12345678
1. SSS0.684
2. SSDP0.28 **0.611
3. SP0.090.46 **0.678
4. LSFI0.25 **0.21 **0.18 **0.622
5. Firm size0.030.24 **0.17 **0.01
6. R&D intensity0.17 **0.11 *0.14 **0.06−0.01
7. Brand image0.22 **0.13 **0.070.26 **−0.110.27 **
8. Machinery0.14 *0.06−0.08−0.060.060.10−0.05
9. Electronics−0.15 **−0.10−0.01−0.060.06−0.040.05−0.59 **
Mean3.7853.1773.9803.9376.2553.3093.8670.380
S.D.0.7420.8450.5430.5550.9280.9570.8780.486
Cronbach’s α0.7930.8240.7610.734
CR0.8370.8180.8680.836
Notes: Value on the diagonal is the square root of AVE, * p < 0.05, ** p < 0.01.
Table
Table 4. Results of regression analysis.
Table 4. Results of regression analysis.
SSDPSP
Model 1Model 2Model 3Model 4Model 5
Constant1.0480.3270.0152.7072.648
Firm size0.231 ***0.221 ***0.197 ***0.109 **0.048
R&D intensity0.0710.0480.0390.076 *0.063 *
Brand image0.137 *0.0870.0650.016−0.008
Machinery−0.031−0.066−0.026−0.206 *−0.188 *
Electronics−0.181−0.136−0.084−0.095−0.057
SSS 0.277 ***0.269 ***0.095 *0.018
SSDP 0.275 ***
LSFI 0.137
SSS × LSFI 0.293 *
R20.0990.1530.1800.0910.246
Adjusted R20.0830.1350.1560.0720.227
F6.245 ***8.474 ***7.658 ***4.721 ***13.091 ***
Notes: sample number = 289, *** p < 0.001; ** p < 0.01; * p < 0.05.
Table
Table 5. Conditional indirect effects at a different level of LSFI.
Table 5. Conditional indirect effects at a different level of LSFI.
ModeratorBoot Indirect
Effect		Boot SEBC 95% CI
Lower Upper
LSFI
3.3750.0130.013−0.0090.043
3.9620.0390.0140.0150.070
4.5000.0620.0210.0260.108
Moderated mediation
Index: 0.0430.0190.0110.085
SE: standard error; BC CI: bias-corrected confidence intervals.
Disclaimer/Publisher’s Note: The statements, opinions and data contained in all publications are solely those of the individual author(s) and contributor(s) and not of MDPI and/or the editor(s). MDPI and/or the editor(s) disclaim responsibility for any injury to people or property resulting from any ideas, methods, instructions or products referred to in the content.

Share and Cite

MDPI and ACS Style

Fan, Z.; Kang, T.-W. Linking Sustainable Supplier Selection to Firm’s Sustainable Performance: The Moderated Mediating Role of Supplier Development and Leadership for Functional Integration. Sustainability 2023, 15, 9757. https://doi.org/10.3390/su15129757

AMA Style

Fan Z, Kang T-W. Linking Sustainable Supplier Selection to Firm’s Sustainable Performance: The Moderated Mediating Role of Supplier Development and Leadership for Functional Integration. Sustainability. 2023; 15(12):9757. https://doi.org/10.3390/su15129757

Chicago/Turabian Style

Fan, Zhigang, and Tae-Won Kang. 2023. "Linking Sustainable Supplier Selection to Firm’s Sustainable Performance: The Moderated Mediating Role of Supplier Development and Leadership for Functional Integration" Sustainability 15, no. 12: 9757. https://doi.org/10.3390/su15129757

Note that from the first issue of 2016, this journal uses article numbers instead of page numbers. See further details here.

Article Metrics

Back to TopTop