Safeguarding compliance with supplier codes of conduct : Investigating how buying organizations ensure the compliance of suppliers with higher bargaining power

Abstract: An increasing number of companies are using Supplier Codes of Conduct to ensure socially responsible behavior in their supply chains. Previous research on SCCs have focused on powerful brand owning multinational corporations and have concluded that a cooperative approach, the cooperation model, has yielded better results than a more traditional approach based on monitoring and sanctions, the compliance model. This study will investigate how organizations with low bargaining power use these two approaches to SCCs to get suppliers to comply with their SCCs, and how this is influenced by the organizations purchasing strategy towards that supplier. Semi structured interviews were conducted with 9 diverse Swedish organizations that use SCCs. The results of the study reveal that the buying organizations focus their efforts on certain suppliers that are selected using different criteria. The results do not conflict with previous findings, however, no strong support for the previous findings is observed either. The results of the study suggest that strong bargaining power is well suited with the compliance model.