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Embedded in networks of relationships, firms are who they buy from and sell to. As a result, a firm's corporate social responsibility (CSR) practices can be influenced by CSR practices of its customers and suppliers—known as CSR diffusion. This study examines how CSR diffuses in a supply chain that encompasses a focal firm, its suppliers, and customers. Adopting a relational view, this research hypothesizes that a firm's CSR is influenced by its customer‐base CSR differently than its supply‐base CSR. By analyzing panel data consisting of 1972 firm‐year observations integrated from multiple data sources, the results offer evidence for a positive impact of customer‐base CSR and a negative impact of supply‐base CSR on firm CSR. Interestingly, when customers and suppliers of a focal firm establish direct business connections (i.e., customer–supplier closure), the positive follow‐suit effect of customer‐base CSR is enhanced. In contrast, the negative free‐ride effect of supply‐base CSR is diminished. This suggests that a focal firm is more likely to embrace CSR practices from CSR‐active supply chain partners when embedded in closed triads. This research shows the need to consider the directionality and closure of relationships in understanding the diffusion of voluntary, ill‐defined, costly operational practices within a supply chain. Highlights: CSR spreads through the supply chain relationally and directionally, with positive impacts originating from customers and negative impacts from suppliers.Direct connections between a firm's customers and suppliers amplify the positive effects of customer CSR and counter the negative effects of supplier CSR on the firm's CSR.Operations and supply chain managers should prioritize building strong, interconnected relationships that extend beyond one‐on‐one connections to foster CSR practices across multiple tiers of the supply chain. [ABSTRACT FROM AUTHOR]

As suppliers' emissions contribute to a significant portion of the global environmental footprint, achieving supply chain wide carbon neutrality largely depends on suppliers' greenhouse gas (GHG) emissions reductions. Although suppliers' customers are increasingly signaling their commitment to tackling climate change through environmental disclosure, whether this signal contributes to supplier emissions reduction remains a question. Using signaling theory, this research proposes an emissions‐reducing effect of customer base environmental disclosure on a supplier's GHG emissions level. Using a 2010–2017 panel dataset from multiple sources, we find empirical evidence supporting the upstream emissions‐reducing effect of customer base environmental disclosure. Further, we identify two customer‐base characteristics that affect this relationship: customer base climate innovation and competition. These findings contribute to the sustainable supply chain management literature by illustrating the effects of the customer base on supplier emissions performance. Specifically, customers could motivate a supplier's engagement in emissions reduction by collectively signaling their environmental commitment through enhanced disclosure. However, the effectiveness of this signaling effect can be contingent on the green innovation and competitive dynamics of the customer base. Highlights: Customers' disclosure of environmental information (i.e., customer base environmental disclosure) motivates suppliers to reduce emissions and thus can drive supply chain decarbonization.Customer base climate innovation and competition alter the effect of customer base environmental disclosure on supplier emissions reduction, and the effect is stronger in less competitive or climate innovative customer bases.Mandatory environmental disclosure regulation on customers could be a means to reduce emissions throughout the supply chain, especially in industries where customers share fewer suppliers and invest less in climate innovations. [ABSTRACT FROM AUTHOR]

A buyer–supplier new product development (NPD) project is an ambiguous and complex transaction, making neither formal contracts nor a collaborative relationship sufficient to ensure project success. NPD project performance could also be directly influenced by the transactional psychological contracts (TPCs) of project members due to their strong motivational effect. Adopting a dyadic view, we explore the performance implications of buyer–supplier TPCs (in)congruence using a matched, dyadic survey dataset from 279 NPD projects. We find that levels of congruence (congruent vs. incongruent), types of congruence (high–high vs. low–low), and directions of incongruence (buyer‐higher vs. supplier‐higher) all affect project performance. Challenging the conventional wisdom that buyer–supplier congruence is generally productive, we find that congruence in TPCs, a generally undesirable type of PC, lowers product quality in NPD projects. This is because congruence in TPCs locks project members in the status quo by creating psychological balance and removing healthy conflicts, which prevents a team from balancing between exploration and exploitation. The combination of buyer‐lower, supplier‐higher TPCs incongruence is most effective for improving both product quality and development efficiency. These results remind NPD project managers that buyer and supplier TPCs can interact to jointly affect project outcomes beyond individual influences of each party's TPC. Highlights: Transactional psychological contracts (TPCs) held by buyer and supplier teams, varying across new product development (NPD) projects even within the same buyer–supplier dyadic relationship, could jointly affect project performance beyond individual influences of each party's TPC.When two negatives: TPC (No. 1) and buyer–supplier incongruence (No. 2), add up and become buyer–supplier incongruence in TPCs, they are shown to become a positive force for improving product quality, particularly when supplier members hold a higher level of TPC than buyer members.High–high TPC congruence is the least productive scenario for both product quality and development efficiency of an NPD project. [ABSTRACT FROM AUTHOR]

With the growing demand for smarter, cleaner, and safer cars, automotive original equipment manufacturers (OEMs) are increasingly seeking novel inventions from innovative new or foreign suppliers. However, not all innovative suppliers are equally valuable for an OEM. When transforming novel inventions into products, OEMs could find it challenging to work with the suppliers with whom they lack trust or have limited shared understanding. In this study, we adopt a social capital perspective to understand how three types of social capital (i.e., structural, relational, and cognitive) influence a supplier's innovation value to the OEM. Hypotheses are tested using a unique data set combining the supply network structure and automotive supplier innovation award. Our results suggest that it is more difficult to obtain innovation value from a new or culturally distant foreign supplier. However, we also found that suppliers whose networks overlap more with the OEM's network are more likely to provide valuable innovations to the OEM, an effect that is stronger for culturally distant suppliers. This study contributes to the supply network and innovation literature by highlighting the importance of understanding the dyadic social capital between the buyer and supplier when evaluating innovation value of a supplier to a buying firm. [ABSTRACT FROM AUTHOR]