Corporate Social Responsibility (CSR) and Contract Manufacturing: exploring the Management Structures and Processes of Ethical Sourcing Practices

Abstract: The practice of focusing on core competences and outsourcing production to save costs, and the need to increasingly acknowledge social and environmental responsibilities along the value chain put brandowning firms under opposing pressures that constitute a significant challenge. Corporate Social Responsibility (CSR) in supply chains is a well-studied subject, but the structures and processes brand owners use within the firm to manage ethical sourcing practices are not. The purpose of this qualitative study is therefore to describe and explore the management of ethical sourcing practices within organisations. Based on the investigations conducted on a number of cases chosen from the textiles and footwear industries, two distinct systems of managing CSR in sourcing, being either control-based or based on shared responsibility, are identified. The way ethical sourcing is managed within firms is found to be influenced by the number of suppliers, their location and the nature of the product in question.