Sustainable supply chain management in developed vs. emerging economies: evidence from the UK and China’s manufacturing industry

In the last few decades, manufacturing firms have shown increasing concerns in relation to the environmental impact of their supply chain activities. Sustainable supply chain management (SSCM) has been considered by manufacturers in both developed and emerging markets as a feasible approach to reducing the environmental impact of operations while simultaneously improving economic performance. However, recently emergent studies have presented mixed views on this issue, expressing that SSCM adoption may not always secure financial benefits. Although research on sustainable supply chains in developed economies has made many valuable contributions, there is a dearth of empirical evidence and theoretical reflection on the characteristics of SSCM in developing and emerging economies. Therefore, this research raises the proposition that SSCM practice can be both environmentally necessary and profitable in both developed and emerging economies. This study examines and compares SSCM practice and the associated performance gains within two different economies on different trajectories- the UK and China.
Conducting an empirical study of 218 manufacturing firms, 146 in the UK and 72 in China, this study examined and compared the impact of SSCM implementation on environmental and economic performance. Using partial least squares structural equation modelling (PLS-SEM) provided by the SmartPLS software, the results show that there are more similarities than differences amongst these two economies. The results reveal that the implementation of SSCM practices results in higher levels of environmental performance for UK and Chinese manufacturers, but does not necessarily lead to improved economic performance, particularly in the context of an emerging market, as only sustainable procurement was found to have a positive impact on economic performance. The findings suggest that firms operating within emerging markets need to undertake SSCM initiatives with a broader consideration of their financial bottom line in order to minimise trade-offs between environmental and economic performance. This study helps practitioners to identify critical areas of SSCM where improvements are required and to prioritise sustainability efforts.