The impact of environmental and social sustainability practices on sourcing behavior

The purpose of this paper is to make an initial attempt to understand if environmental and social sustainability practices of suppliers influence the buying decision and ultimate supplier selection in a purchasing organization.

In order to test the effects of sustainability on sourcing decisions, this research utilizes two scenario-based behavioral experiments grounded in a transportation carrier selection context.

Two scenario-based experiments with managerial participants were conducted and results suggest that environmental and social aspects of sustainability are indeed relevant sourcing considerations that impact both economic and relational aspects of exchange relationships. These sustainability aspects enable carriers to differentiate themselves in a highly commoditized market.

Extant research advocates for sourcing organizations to take an active role in selecting sustainable suppliers. However, little is known about how supplier sustainability performance impacts sourcing decisions and supplier selection. This research addresses this gap in the literature and explores the effects of price, environmental, and social sustainability on purchase intentions and trust formation in a transportation carrier selection context.