The Religion of The Customer's Location and The Supplier's ESG
Year: 2025
Type: article
Abstract: The supplier's ESG performance directly affects the sustainability of the entire value chain. Religious culture is an important component of informal institutions, influences macroeconomic development and the behavior of microeconomic entities as a social norm. This paper explores the relationship between the religion of customers in their locations and suppliers' Environmental, Social, and Governance (ESG) performance from the perspective of the supply chain. The aim is to investigate the impact of customers' religion on suppliers' ESG performance, particularly focusing on the potential impact on ESG evaluations when suppliers' top five sales customers are concentrated in a particular religion. The religion of customers can indirectly affect suppliers' ESG performance by influencing customer values, needs and preferences, and social pressures. Therefore, understanding the mechanism of how customers' religion impact suppliers' ESG performance can help companies better formulate ESG strategies and enhance their level of sustainable development. Additionally, customers from different religious backgrounds may have varying impacts on suppliers' ESG performance. For example, customers may prefer to collaborate with suppliers that align with their religious values, thereby encouraging suppliers to improve their ESG performance. China only required suppliers to disclose information about their top five customers on a policy basis starting in 2009, therefore,this paper selects and processes listed companies on the Shanghai and Shenzhen A-share markets from 2009 to 2023. we use Python to scrape geographic data of religious sites across the country and calculates geographical distances by calling latitude and longitude data through the A-map API to measure the degree of religious influence based on the number of religious sites within a certain distance from customers' locations. The study investigates customer groups from different religious backgrounds, including Christianity, Islam, and Buddhism. The findings provide important theoretical and practical guidance for companies to develop ESG strategies that align with various cultural backgrounds and emphasize the importance of considering religious factors in international operations.
DOI: 10.54097/mjz1n845
Author: Shuwan Hu
Language: English
Subfield: Strategy and Management
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W4407854406