Third Party Sustainability Assessment: Is It A Multi-Tier Supply Chain Solution?

Hannibal, CL and Kauppi, K (2019) Third Party Sustainability Assessment: Is It A Multi-Tier Supply Chain Solution? International Journal of Production Economics, 217. pp. 78-87. ISSN 0925-5273

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Abstract

The paper examines the different third party approaches used to assess the social sustainability of global multi-tier supply chains. Information asymmetries between supply chain actors and stakeholders can result in uncertainty about how a good has been produced and traded, resulting in sustainability uncertainty. Third party social sustainability assessment is one mechanism used to monitor and communicate the credentials of everyday products to stakeholders. We frame our study using information processing theory to discuss how third party assessors can help to reduce sustainability uncertainty. As social sustainability is of particular importance in labor-intensive industries, empirical data is drawn from agriculture, textiles, handicrafts, footwear and consumer electronics supply chains. The analysis of semi-structured interviews with assessors reveals differing approaches to assessment. We show how these approaches utilize differing numbers of supply chain tiers. Some, for example, focus only on the farmer or raw material supplier when assessing social sustainability, which raises questions about the credentials of actors further downstream. The communities and livelihoods of supply chain actors, often located in the global South, can be dependent on the new, niche and potentially more profitable markets made available to goods that can demonstrate their social sustainability credentials. Robust assessment is therefore integral in accessing these new markets. The study offers a comparison between different assessors that will be of interest to scholars and also to supply chain actors considering engaging in social sustainability assessment.