Sustainable Supplier Selection under Financial Hardships: The Conflicting Impact of Spatial and Temporal Psychological Distances

Economic crises stress trade-offs between costs and sustainability for environmentally orientated firms impacting supply-chain management decisions. Inspired by the disruption to supply caused by the COVID-19 pandemic, we explore supplier selection during a financial crisis, studying the impact of p...

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Bibliographic Details
Published in:Sustainability 2023-06, Vol.15 (12), p.9561
Main Authors: Balaguer-Mercado, Alain, Kirshner, Samuel N, Tseng, Chung-Li
Format: Article
Language:English
Subjects:
Component and supplier management
COVID-19
Decision making
Economic crisis
Environmental auditing
Environmental management
Green procurement
Impact analysis
Logistics
Pandemics
Psychological factors
Suppliers
Supply chains
Sustainability
Sustainable development
Tradeoffs
Vendor relations
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Summary:Economic crises stress trade-offs between costs and sustainability for environmentally orientated firms impacting supply-chain management decisions. Inspired by the disruption to supply caused by the COVID-19 pandemic, we explore supplier selection during a financial crisis, studying the impact of psychological distance on the cost–environmental performance trade-off. Across three experiments (N = 420), we examine the choice between a low-cost and an environmental supplier at close and far psychological distances. Study 1 and Study 2 demonstrate that closer spatial and social distances, respectively, increase the preference for the environmental supplier. Study 3 extends these studies by showing that distance influences perceptions of the firm’s objectives, mediating supplier preference. In contrast, Study 4 shows that a far temporal distance increases the preference for selecting the environmental supplier, differing from spatial distance, due to a reversal in the appraisal of the firm’s objectives. Taken together, our results provide a greater understanding of the cognitive influences on sustainable procurement decision-making during the COVID-19 crisis.
ISSN:2071-1050
2071-1050
DOI:10.3390/su15129561