The Impact of ESG Disclosure on Supply Chain Performance in Small and Medium Enterprises

Although studies have identified some positive outcomes of environmental, social, and governance (ESG) disclosure, such as reduced risk and increased profit, it remains unclear how disclosure influences firms, especially small and medium-sized enterprises (SMEs), to improve their supply chain management. To fill this gap, we drew on the perspective of supply chain justice to analyze the relationship between the breadth of ESG disclosure and supply chain performance. Using hierarchical regression to analyze data from 373 Chinese SMEs, we found that three supply chain justice types (distributional, procedural, and interactional justice) positively mediated the ESG disclosure breadth-supply chain performance association. Interestingly, supply chain complexity negatively moderated the positive association between ESG disclosure breadth and three supply chain justice types. Our study contributes to the current literature on the interface between ESG and supply chain management by highlighting how and when ESG disclosure can improve a firm’s supply chain performance.