Enhancing intangible CSR compliance in supply chains: an analysis of contractual incentives
研究一个供应商和一个零售商组成的供应链，通过合同设计激励供应商遵守企业社会责任标准，分析不同合同对合规生产、订单量和利润的影响，发现期权合同能实现双赢，长期合同有局限性。
We examine a supply chain consisting of one supplier and one retailer. In this scenario, the supplier may engage in low-cost production practices that do not align with corporate social responsibility (CSR) standards but are difficult to detect. The disclosure of such non-compliant production could potentially harm the reputation of the downstream retailer, leading consumers who prioritize social consciousness to exit the market. To address this issue, we propose implementing contracts to evaluate their effectiveness in fostering supplier adherence to CSR standards during the production process, influencing the order quantity set by the retailer, and assessing the overall impact on supply chain profitability. The findings indicate that: (1) In a single-period scenario, both lump-sum penalty and bonus contracts, as well as option contracts, have been found to be effective in increasing CSR-compliant production to full compliance, aligning with the level of the centralized supply chain; (2) Compared to lump-sum penalty and bonus contracts, an option contract can efficiently boost the order quantity set by the retailer to align with the centralized scenario, leading to a win-win equilibrium; (3) The preferred deposit ratio may differ between retailers and suppliers; however, generally, a moderate ratio is preferable for both parties. Extreme ratios, whether too low or too high, can diminish the optimal order quantity and CSR-compliant proportion, affecting profitability across the supply chain; (4) In the long-term scenario, contingent renewal contracts possessing endogenous renewal probability can effectively improve the supplier’s CSR-compliant production to attain full compliance. However, their performance in increasing the retailer’s order quantity to the centralized level is limited. (5) In the extensions, we validate the performance of proposed contracts using the IPE enterprise regulatory record data and provide relevant management suggestions.