Transparency fallacy: Unintended consequences of stakeholder claims on responsibility in supply chains

The purpose of this paper is to focus on the research question of how stakeholder claims for transparency work as a means to support responsibility in the international supply chain.

This theoretical study analyses the relationship between stakeholder claims for corporate transparency and responsible business in the global context, and develops a conceptual model for further theoretical and empirical work.

The study finds that the call for corporate transparency is insufficient as a means to increase responsibility within international supply chains. The erroneous belief that stakeholder claims for transparency will lead to responsible behaviour is identified as the “transparency fallacy”. The fallacy emerges from the denial of opacity in organisations and the blindness to the conditions of international supply chains (including complexity, distance, and resistance) that work against attempts to increase transparency.

Acknowledging the limits of the transparency mechanism in both management theory and practice is necessary in order to advance responsible business in the international arena. Being conceptual in nature, the generic limitations of the type of research apply.

While acknowledging opacity, corporate managers and stakeholders should focus on changing the supply chain conditions to support responsible behaviour. This includes reducing complexity, distance, and resistance in the supply network.

This study contests the commonly assumed link between corporate transparency and responsibility, and sheds light on the limits and unintended consequences of stakeholder attempts to impose transparency on business organisations.