Conceptualizing the Capability of Supplier Sustainability Risk Management

External stakeholders have built up high expectations on "sustainability", putting firms under constant watch by non-governmental organizations, media, etc. (Bellmann, 1999; Kudla & Stölzle, 2011). Stakeholders usually do not differentiate between a firm's and its suppliers' operations. They hold the focal firm responsible for all practices involved in the making of the product, including any potential sustainability concern (Koplin, Seuring & Mesterharm, 2007; Rao, 2002). Suppliers not complying with the firm's promised standards, norms, or values are likely to cause damaged brand reputation, decreased brand value, or destroyed consumer confidence. Nike and Mattel are prominent examples of brands that suffered from non-compliant suppliers and faced media campaigns, consumer boycotts and partially declining sales (Locke & Romis, 2007; Wagner et al., 2009).