The financial impacts of environmental violations on supply chains: Evidence from an emerging market

Yangchun Xiong; Hugo K.S. Lam; Qiaoxuan Hu; Rachel W.Y. Yee; Constantin Blome

doi:10.1016/j.tre.2021.102345

The financial impacts of environmental violations on supply chains: Evidence from an emerging market

Yangchun Xiong, Hugo K.S. Lam, Qiaoxuan Hu, Rachel W.Y. Yee, Constantin Blome

The Hong Kong Polytechnic University

Research output: Journal article publication › Journal article › Academic research › peer-review

14 Citations (Scopus)

Abstract

Based on 100 environmental violations occurring in China in 2018 and matched supply chain relationship data obtained from Bloomberg, our research shows that environmental violations have negative financial impacts on not only the violators but also their supply chain partners including customers and suppliers. Nevertheless, environmental transparency and supply chain diversity help these supply chain partners mitigate the negative effects arising from the environmental violations. While the mitigating role of environmental transparency is more pronounced for customers than suppliers, supply chain diversity has a similar mitigating effect for both customers and suppliers.

Original language	English
Article number	102345
Journal	Transportation Research Part E: Logistics and Transportation Review
Volume	151
DOIs	https://doi.org/10.1016/j.tre.2021.102345
Publication status	Published - Jul 2021

Keywords

Emerging market
Environmental transparency
Environmental violation
Market value
Supply chain diversity

ASJC Scopus subject areas

Business and International Management
Civil and Structural Engineering
Transportation

More information

10.1016/j.tre.2021.102345

Cite this

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abstract = "Based on 100 environmental violations occurring in China in 2018 and matched supply chain relationship data obtained from Bloomberg, our research shows that environmental violations have negative financial impacts on not only the violators but also their supply chain partners including customers and suppliers. Nevertheless, environmental transparency and supply chain diversity help these supply chain partners mitigate the negative effects arising from the environmental violations. While the mitigating role of environmental transparency is more pronounced for customers than suppliers, supply chain diversity has a similar mitigating effect for both customers and suppliers.",

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AU - Blome, Constantin

N1 - Funding Information: The authors thank the Co-Editor-in-Chief, Prof. Jason Choi, and three anonymous reviewers for their insightful comments and useful suggestions, which help improve the quality of this paper. This work was partially supported by the grant from The Hong Kong Polytechnic University under grant number 1-ZVLG. Lam acknowledges the Leverhulme Trust’s support through the Leverhulme Research Fellowship (RF-2020-474). Publisher Copyright: © 2021 Elsevier Ltd

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N2 - Based on 100 environmental violations occurring in China in 2018 and matched supply chain relationship data obtained from Bloomberg, our research shows that environmental violations have negative financial impacts on not only the violators but also their supply chain partners including customers and suppliers. Nevertheless, environmental transparency and supply chain diversity help these supply chain partners mitigate the negative effects arising from the environmental violations. While the mitigating role of environmental transparency is more pronounced for customers than suppliers, supply chain diversity has a similar mitigating effect for both customers and suppliers.

AB - Based on 100 environmental violations occurring in China in 2018 and matched supply chain relationship data obtained from Bloomberg, our research shows that environmental violations have negative financial impacts on not only the violators but also their supply chain partners including customers and suppliers. Nevertheless, environmental transparency and supply chain diversity help these supply chain partners mitigate the negative effects arising from the environmental violations. While the mitigating role of environmental transparency is more pronounced for customers than suppliers, supply chain diversity has a similar mitigating effect for both customers and suppliers.

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The financial impacts of environmental violations on supply chains: Evidence from an emerging market

Abstract

Keywords

ASJC Scopus subject areas

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