Management of social sustainability in SME’s supply chains: Insights from a multiple case study

In today’s markets, companies around the World cause and face an increasing number of environmental and social sustainability issues. As globalization and the accelerating pace and prices in the markets have led companies to operate in international supply networks, companies are not only expected to tackle the issues they face in their operations but also those found in their supply chains. Therefore, sustainable supply chain management (SSCM) has received attention from researchers in different fields. However, the focus has remained on multinational corporations’ perspectives, while small and medium-sized enterprises (SMEs) have been disregarded, despite constituting the majority of the markets and workplaces. Furthermore, while research has addressed environmental and social sustainability topics to some extent, more practical knowledge on social sustainability management in supply chains is needed. The purpose of this thesis is to address these research gaps and provide more knowledge on the management of social sustainability in SMEs’ supply chains. Specifically, the study focuses on social SSCM drivers, barriers, and practices of textile companies with supply chains in countries with lower levels of work standards. The literature review provides insights from existing research on these topics. A conceptual framework, modified from the SSCM literature, is created to guide the empirical research of the study, which adopts a qualitative multiple case study approach involving six Finnish small or medium-sized textile companies. Data is collected through semi-structured interviews with company representatives, and thematic analysis is conducted to analyse the data. The main findings of the study indicate that SMEs are driven to engage in social sustainability work due to the interest of their owners or managers in the topic. The lack of this interest can lead the entire supply chain towards unsustainable behaviour. Sustainability-oriented companies simultaneously apply several practices and strategies to address social issues, even if the issues may not be well recognized or known. Non-sustainability-oriented companies implement fewer practices, with a focus on those that may enhance sustainability while also creating operational or economic benefits for the company. The empirical data also reveals that while SMEs employ various SSCM strategies and practices, they face challenges in planning and measuring their work and in identifying the potential social and economic benefits generated by their actions. The discussion of the empirical findings in relation to the literature indicates that previous studies mainly support the findings but differ in terms of how SMEs plan and measure their SSCM work and the importance of economic aspects as drivers and outcomes for them. While the study has limitations as the findings cannot be generalized to fully represent the diverse group of SMEs, this thesis contributes to existing research and provides a practical understanding of SMEs’ drivers, barriers, and practices. These insights could be utilized, for example, by actors involved in developing tools and guidelines for planning social SSCM work in SMEs