Supply chain corporate responsibility in the banking industry in South Africa.
Chadwick, Keith Micheal.
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The power and influence that large businesses enjoy in the areas of wealth creation, and in broader societal and environmental issues generally, is unprecedented in human experience. This dominance however, has its detractors in the form of diverse stakeholder groups, some of whom are sceptical about the social, environmental and corporate governance behaviours and performance of large organisations. High-profile cases of corporate misconduct have fuelled a crisis of legitimacy in the minds of some of these stakeholders. As a consequence, these stakeholders are demanding higher levels of transparency, accountability, trust and integrity from organisations, whilst also acknowledging the fact that these organisations must remain economically viable. Business leaders and analysts are increasingly appreciative of the potential value that can be created or conserved through visibly endorsing incrementally higher standards of social, environmental and ethical behaviour in their organisations. Progressive and responsible organisations across the world are either contemplating, or have already implemented, corporate responsibility programmes. These organisations include banks operating in the South African financial services industry. This research contends that various issues and trends are driving changes in banks operating in South Africa. One driver of change is an imperative to reduce the reputational risk profile amongst these banks, and has caused most of the larger South African banks to embrace corporate responsibility programmes to some extent. This research deals with an emerging and important dimension of corporate responsibility in the banking industry in South Africa, namely supply chain corporate responsibility. The primary objective of this research was to explore and describe the state of supply chain corporate responsibility programmes and practices in the banking industry. Specifically, it investigated and analysed how these programmes have been structured and implemented, the challenges that such programmes have encountered, the maturity of these programmes in these banks, and the outcomes of these programmes. The research was conducted in a phased approach, and followed a typical business research methodology. A literature search was conducted in order to reflect on the context, background and components of the wider field of corporate responsibility, the major drivers of change in the banking industry in South Africa, and the emerging role of procurement functions as the champions of supply chain corporate responsibility in these institutions. This included procurement departments' roles as facilitators of supply chain corporate responsibility programmes in their organisations. In addition, the literature search identified potential opportunities, challenges and pitfalls associated with supply chain corporate responsibility, and cited examples of best-practice supply chain corporate responsibility programmes in various companies. The research problem statement, the research framework, and the primary and secondary research objectives for this research were then compiled. A questionnaire was drafted, seeking to elicit views and comments on the state of supply chain corporate responsibility amongst selected respondents in the banking industry in South Africa. Once responses to this questionnaire had been received, the results were recorded and analysed, conclusions were drawn from these results, and recommendations were complied for future research in this area. The research revealed and concluded that supply chain corporate responsibility programmes are not mature or extensively developed in banks operating in South Africa. An aspiration-adoption gap exists, between what banks aspire to do in regard to supply chain corporate responsibility, and the programmes that they have implemented in practice. While banks that implemented supply chain corporate responsibility programmes have identified those areas in their procurement cycles that corporate responsibility impacts upon, important and best-of-breed supply chain corporate responsibility steps and practices have not been implemented in these institutions. Supply chain corporate responsibility programmes were considered to be able to create or conserve business value amongst banks operating in South Africa. There was a broad appreciation amongst these banks that supply chain corporate responsibility programmes should deliver nett positive results and value in their organisations. However, supply chain corporate responsibility programmes do face various significant challenges and pitfalls. These challenges and pitfalls need to be addressed and resolved if supply chain corporate responsibility programmes are to deliver their rightful value.