By comparing two unequal European buyers, this study explores network relationships in Supply chain (SC) from a corporate social responsibility (CSR) perspective in the Bangladesh apparel industry. A qualitative method has been applied for data collection though interviews and gathering secondary material in the form of newspaper articles and buyers’ websites. A combination of network perspective and compliance and capacity building constitutes the theoretical foundation of the study.
The result shows that the larger buyer stresses on control and strictly following the code of conducts while the smaller buyer relies on collaboration and dialog in implementing CSR. Introduction Consumers are more conscious today about what they are buying and where the products are produced. And it has compelled multinationals to take responsibility for environmental protections, safety, security and economic well-being of the employees in the supply chain (SC). Cannon (2006) argues that there is a growing public interest in where and how goods are produced. Murphy et al (2013) recognize that consumers can vote for or against corporate behavior by either buying or boycotting products. Which in turn affects a company’s financial results.
CSR has therefore become a significant issue for firms, particularly procuring products from developing country suppliers. Commission of the European communities (2001, p.7) has defined CSR as ” the voluntary integration, by companies, of social and environmental concerns in their commercial operations and in their relationships with interested parties “.
Vaaland et al (2008) describe CSR as complex and ambiguous because it is reflectes by multiple and different perspectives and views.
Stakeholder theory has been largely used to study CSR (Smith et al., 2010) and it has been widely embraced by businesses as well (Kolk & Van Tulder, 2010). Freeman (1984, p. 46) has defined stakeholders as ” any group or individual who can affect or is affected by the achievement of the organization’s objectives “.
In this view, the organization (buyer) has the dominant role and can dictate how the work to be carried out. The scope for developing network relationship among the stakeholders is therefore limited. Post et al (2002) however offers a new stakeholder view which stresses relationships rather than transactions within a network of stakeholders. This approach shows a broader context integrating different stakeholders for success and survival of the firm. Stakeholder theory is not dynamic and does not address how asymmetric actors in SC network can work to implement CSR. Cramer observes that organizing CSR in SC is a challenging task and literature on how companies can organize CSR in such setting is scarce.
We argue that industrial network perspective which deals with the establishment of close relationships between buyers, suppliers and other actors can significantly fill this research gap (Håkansson, 1982).
The theoretical view in the network approach is that firms develop long-lasting relationships with other actors (such as suppliers, distributors, etc). Mean engage in activities with resources for a joint competitive position (Håkansson & Snehota, 2006.