Sustainability Dilemmas: Risk and Uncertainty in Supply Chain Management

Abstract

Contrary to the considerable development of Sustainable Supply Chain Management (SSCM) research, the level of conceptual clarity falls short in unveiling the strategic implications of sustainability integration into core business practices. This leads to dilemmas with respect to aspired and achieved levels of business responsibility increasing exposure to financial and sustainability hazards. Given the various incidents of supplier misconduct and cases where no apparent breaches still impose threats to buying firms, it is undeniably mesmeric experiencing the defiance of “common sense” law: just because risks are classified, and responses are deployed, it would be wrong to assume that vulnerability is eradicated. To overcome impediments, we need to discern between uncertainty and risk. To this end, literature supports that firms address issues based on instrumental and moral rationales encompassing fundamentally different justifications. Building on work from risk management, SSCM, paradox as well as management accounting and control, and inserting ideas from entrepreneurship literature, we investigate these particularities and explain how firms could develop their sustainability initiatives and risk management strategies across their Supply Chains (SCs) through an integrative framework. This refinement allows us to increase the odds of more sustainable SCs through a multilevel approach reverberating the interface of strategy and operations. The paper concludes with commenting on the theoretical and managerial implications as well as proposing avenues for future research.