Does bad press help or hinder sustainable supply chain management? An empirical investigation of US-based corporations

This study explores the effect of negative news about an organization on its sustainable supply chain management (SSCM) practices. We focus on how public reports about controversial business practices motivate a company to make adjustments so that environmental and social concerns are better included in its supply chain management practices. Using agenda-setting theory, we identify managerial commitment as an important factor in transmitting external media pressure. We analyse longitudinal data, ranging from 2002 through 2014 and collected for more than 700 US-based corporations. Our findings reveal that companies significantly increase SSCM after being the subject of negative news, particularly when management commitment to environmental sustainability and social welfare is high. Our findings should encourage supply chain decision makers to consider more broadly how external stakeholders view their global supply chain operations. Our research sheds light on negative news as an external factor; previous literature used media attention as anecdotal evidence and focused more on internal company factors. We contribute to research in SSCM by studying the mediation effect. It is essential that supply chain decision makers better apprehend the importance of negative news, management commitment, and SSCM and understand their role in influencing public opinion.