Shifting the context: reviews and research agendas for traditional, reputational and societal supply chain risk

Within the field of supply chain management (SCM), supply chain risk management (SCRM) represents an important topical domain, which has received rising attention and witnessed considerable development over the past decades. The field’s dynamic evolution has resulted in numerous investigations and valuable literature reviews that synthesize research findings and examine key concepts (e.g. Ho et al., 2015; Fan and Stevenson, 2018; Pournader et al., 2020; Wicaksana et al., 2022). However, SCRM research, and thus most of these reviews, focus primarily on risks associated with the material flow which materialize in supply chain disruptions. We refer to research in this stream as “traditional” supply chain risk, denoting a potential negative deviation from an assumed performance value that results in detrimental outcomes for the focal firm (Knight, 1921; Wagner and Bode, 2006). From a traditional SCRM perspective, these risks emerge from supply chain-immanent sources such as inaccurate demand forecasts or supplier failure, as well as from sources external to the supply chain (i.e. its context), such as natural disasters or terrorist attacks (Chopra and Sodhi, 2004; Tang, 2006a) that often lead to operational failure (Wagner and Bode, 2006).

For about a decade and a half, scholars have also begun examining another type of risk, namely “reputational” supply chain risk. This risk emerges from unsustainable conditions in a focal firm’s supply chain, materializes in adverse stakeholder reactions and causes reputational damage, often without an accompanying disruption (Hofmann et al., 2014). This relatively younger type of risk presents a first shift away from the material flow and supply chain-immanent risk sources toward a materialization in the supply chain context.

Lately, scholars have shifted the context in the consideration of supply chain risks even further. Studies anecdotally found evidence for supply chains, which become part of broader problems that do not necessarily have a direct negative impact on companies, but rather on the environment and society-at-large (e.g. Mukherjee and Sinha, 2018; Huang et al., 2021). Duensing et al. (2023) proposed to categorize these risks as “societal supply chain risk”. Societal supply chain risk also acknowledges the importance of the context – like reputational risk – but differs in that it has detrimental effects on stakeholders other than focal firms and external to supply chains. For example, oversupply of drugs through North American supply chains can augment the opioid crisis (Skilton and Bernardes, 2022), mainly negatively effecting societies.

Based on the shared understanding that a supply chain’s context occupies a major role for supply chains and their management (Pagell and Wu, 2009; Wieland, 2021) – for traditional supply chain risk as a potential risk source (e.g. natural disasters), for reputational risk as the locus of risk materialization (e.g. adverse stakeholder reactions), and for societal risk as the risk effect (e.g. crossing of planetary boundaries) —we conduct a literature review on each stream. Our motivation in doing so is that the consideration of the supply chain context, which subsumes numerous dimensions such as the socioeconomic, institutional, linguistic and spatial (Montabon et al., 2016; Busse et al., 2016a, 2016b) and integrates different levels of analysis such as the political-economic and the planetary (Wieland, 2021), hopefully facilitates important insights and implications for future SCRM research, which may have gone unnoticed in prior reviews. Moreover, reputational and societal supply chain risks have only received little attention in previous reviews on the broader concept of “supply chain risk” (e.g. Ho et al., 2015; Fan and Stevenson, 2018; Pournader et al., 2020). Those reviews either neglect the concept of reputation and sustainability altogether or just drop them. Rafi-Ul-Shan et al. (2018), for example, criticize that the concepts of risk and sustainability have been treated separately in the literature, however, fail to develop a framework connecting them, apart from a descriptive overview. Cunha et al. (2019), on the contrary, conduct a structured literature review on social issues that may trigger reputational risks (called “social risks”), yet rely strongly on Hofmann et al.’s (2014) concluding framework. On the contrary, Wicaksana et al. (2022, p. 7156) emphasize this shortcoming of not including “emerging and hidden risks, such as sustainability/reputational risks”. Their review even identifies “social risks”, i.e. “disruptions that prevent the establishment of honourable and equitable actions for supply chain parties (i.e. workers, partners) and society” (Wicaksana et al., 2022, p. 7162). However, this review remains largely bibliometric and descriptive and does not provide a comprehensive overview for future research on either social or reputational/sustainability risks. The closest to a review on reputational supply chain risk is von Berlepsch et al.’s (2024) recent review of the “importance of corporate reputation for sustainable supply chains”. However, this review has a narrow focus on “corporate reputation” and hence neglects the close interconnectedness between sustainable supply chain risks and reputational risks which this article specifically recognizes. Accordingly, a dedicated review of the three streams of traditional, reputational and societal supply chain risks is still amiss.

Our research not only synthesizes key findings and identifies multiple points of contention. Rather, as its main contribution, it provides detailed future research agendas tailored to traditional, reputational and societal supply chain risk. Thereby, this article provides guidance to SCRM scholars in their quest to conduct impactful research.

This section provides the rationale behind the scope of the review and depicts our motivation for conducting a narrative review. Finally, we elaborate on the used procedures.

The observation that the critical role of supply chain context connects the streams of traditional, reputational and societal supply chain risks – even though the roles that the context plays differ from one stream to another – motivated us to review them jointly, convinced that they can inform each other. For the firmly established literature stream on traditional supply chain risk, multiple literature reviews with highly valuable research implications are already available (e.g. Ho et al., 2015; Fan and Stevenson, 2018; Pournader et al., 2020; Wicaksana et al., 2022). Our rationale for still incorporating this stream is twofold. First, we conjecture that its insights have much to offer to the younger streams of reputational and societal supply chain risk. For example, the latter two could benefit from adoption or adaption of concepts such as vulnerability, robustness, agility and ultimately resilience (Holgado et al., 2024). Accordingly, it would not have been sensible or wise to ignore their achievements nor to repeat what previous reviews already accomplished.

Second, traditional SCRM research has mostly viewed the context in which supply chains are embedded only as a source from which some risks happen to emerge (e.g. Wagner and Bode, 2006). We argue that a more informed consideration of the interactions between supply chains and their context holds significant potential for future research on traditional risk. For example, some of the most pressing questions for SCM and the global economy overall relate to whether, and possibly to what extent, globalization and outsourcing should be reversed (Foerstl et al., 2016; Di Sano et al., 2023).

The maturing stream of reputational supply chain risks has evolved fast over the past 10–15 years (Petersen and Lemke, 2015). At this point, it comprises dozens of scholarly investigations, which we argue are now in need of being overviewed. We seek to highlight past milestones of the stream and suggest a trajectory for future research through our narrative review.

In contrast, the study of societal supply chain risks – mostly without the label – is still in its infancy, with only a handful of initial studies that we are aware of. While a review for such a young concept is rather unconventional, we aim to kickstart an overdue conversation on what research on societal supply chain risk could entail when considered as a research stream that stands for itself. In summary, the different levels of maturity of the three streams under review set slightly different objectives and justify different approaches to our study, with shifting balances between reviews and research agendas (Figure 1).

For each type of risk, our goal is first to review its conceptualization, i.e. to identify any ambiguities among extant definitions and to establish a common understanding of the respective concept for future research. To facilitate the handling of the respective type of risk in corporate practice, we also seek to review the research concerning its management. As we assume that the latter necessitates a thorough understanding of where the respective risks come from, we also review the literature for the respective risk sources. The tripartite structure of conceptualization, sources and management proofs effective for traditional and reputational supply chain risks, whereas research on the sources and subsequent management of societal risks is still largely lacking. Accordingly, the respective section leads directly from the conceptualization of societal risks to future research on them.

We chose a “narrative” review of the overview type (Easterby-Smith et al., 2002; Green et al., 2006). Overviews typically aggregate much information in a single, relatively easy-to-read narrative, take broad perspectives often scrutinizing the historical evolution of the study of a topic and consider theory and empirical context jointly (Green et al., 2006). Most Academy of Management Annals articles and publications in the annual review issue of the Journal of Management use narrative literature reviews of the overview type. These studies tend to be written by rather senior scholars and typically seek to provide new directions for a field. SCM in contrast has witnessed a shift toward “structured” (also called “systematic”) literature reviews (Seuring et al., 2021), whose rather mechanistic processes (Tranfield et al., 2003; Durach et al., 2017) provide an attractive impression of objectivity to readers. It is worth noting that, despite all the procedural prescriptions for conducting structured literature reviews, these types of reviews also necessitate that authors use their understanding of their field, experience and creativity to come up with meaningful future research suggestions (Seuring et al., 2021). In both cases, profound understanding of the literature is pivotal toward further theory development (Weick, 1995). Consequently, the best criterion to evaluate such articles might be the extent to which the research agendas are interesting and useful for shaping the future development of the respective field.

In line with previous SCM research (e.g. Taticchi et al., 2015; Rejeb et al., 2021; Browning et al., 2023; Cole et al., 2023), we chose a narrative literature review for a multitude of reasons. First, the aforementioned different levels of maturity of the three streams to be reviewed require different approaches, a flexibility requirement that can best be met with a narrative review (Snyder, 2019). Moreover, the narrative literature review is particularly well-suited for addressing issues of a broader scope, identifying gaps in researchers’ knowledge and providing directions for future research (Collins and Fauser, 2005; Taticchi et al., 2015). We start from the observation that SCRM, which has generated vast amounts of valuable knowledge, has traditionally been very, if not overly, focused on the material flow domain, although the context of a supply chain plays a key role throughout the manifestation process via the risk emergence, materialization and effect stage. This slightly critical assessment necessitates open-mindedness in evaluating prior insights and conceiving pathways forward. The degrees of freedom inherent in narrative literature reviews are particularly suited to such a situation (Green et al., 2006). Moreover, the “sheer size of the existing literature” on traditional supply chain risks “prohibits a comprehensive, structured review” (Browning et al., 2023, p. 1842). Furthermore, for the research stream of societal risk, we also anticipate challenges in guaranteeing completeness if a structured literature review method was chosen. As the term “societal supply chain risk” was only recently coined by Duensing et al. (2023), studies that do not explicitly mention this term but nevertheless study similar phenomena could not be captured through search terms and would ultimately not be included in the sample (such as Gray et al., 2011; Mukherjee and Sinha, 2018, or Huang et al., 2021).

We began this investigation with what we believe to have been a profound understanding of the literature on traditional supply chain risk and an intimate knowledge of the other two streams. Whereas we initiated our analysis of traditional risks with numerous dedicated literature reviews and the publications cited therein, we compiled a chronological overview of the studies of reputational risk that we were aware of as a start. For the study of societal risks, we commenced with the study of Duensing et al. (2023) and the research by Skilton and Bernardes (2022) cited therein. Subsequently, we intensively employed keyword searches and cross-referencing techniques (Denyer and Tranfield, 2009), resulting in approximately 280 studies that we intended to refer to within this article. Later, we had to remove many references again for word length restrictions. We thus believe to have generated a very comprehensive overview although, like most authors of narrative reviews (Green et al., 2006), we shy away from promising “completeness” of the discussed literature base.

While we relied on the flexibility available to researchers in a narrative review, we were also cognizant of the inherent dangers of the used methodology. In particular, we were concerned that we might end up writing an opinion piece backed up with references instead of offering an objective view of the prior literature (Green et al., 2006). Further dangers comprise an overreliance on our own previous works and scholarly perspectives (Green et al., 2006). To avoid or at least mitigate these dangers and to foster rigor, we established several safeguarding procedures. While we decided upfront that we wanted to exploit the potential of narrative reviews to dedicate more attention to some publications than to others, we deliberately operationalized this criterion to prevent ourselves from subjectively “favoring” certain studies. Accordingly, we scrutinized where articles were published, how often they had been cited, how rigorous the methods appeared, and how convincing the theoretical arguments seemed before deciding on their prominence in our review. Moreover, we deliberately searched for contradictory findings and tried to make these transparent within our overview. As a general rule, one author reviewed the literature and the others acted as critical counterparts. We discussed and rewrote all sections numerous times until everyone agreed with them, to establish as unbiased an account as possible.

Despite these efforts for methodological rigor, the following review sections cannot represent an objective portrayal of the accumulated evidence. Rather, they should be viewed as the authors’ best subjective efforts aiming at objectivity. The associated research agendas represent the outcome of numerous discussions on the desirable evolution of the three research streams.

Scholarship surrounding traditional supply chain risk represents a well-established domain, with a large number of reviews and research agendas published over the past decades (e.g. Tang, 2006a; Tang and Musa, 2011; Sodhi et al., 2012; Ho et al., 2015; Heckmann et al., 2015; Fan and Stevenson, 2018; Pournader et al., 2020; Wicaksana et al., 2022; Browning et al., 2023). Unlike other disciplines such as finance and broader management where the notion of risk captures both a potential upside (positive) and a potential downside (negative) deviation from an expected performance, thus inheriting all outcomes of an expected value (Markowitz, 1952; March and Shapira, 1987), the research field of SCM defines supply chain risk commonly “as the negative deviation from the expected value of a certain performance measure, resulting in negative consequences for the focal firm” (Wagner and Bode, 2006, p. 303).

Supply chain risk thus refers to possible future events with a measurable uncertainty that are characterized by their likelihood of occurrence and impact on a focal firm’s and potentially also on supply chain partners’ (Hendricks et al., 2009) performance objectives, including profit, operating income, return on sales, firm value, product quality and customer satisfaction (Knight, 1921; Hendricks and Singhal, 2005a; Craighead et al., 2007; Tang and Musa, 2011; Heckmann et al., 2015). It can also impact stock price performance (Hendricks and Singhal, 2005b). In essence, supply chain risk spawns significant financial, operational and relational costs, either for systematically managing the risk or for recovering from it (Blackhurst et al., 2005; Hendricks and Singhal, 2005b; Wagner and Bode, 2008; Ponomarov and Holcomb, 2009; Speier et al., 2011; Sodhi et al., 2012).

The SCRM research domain recognizes a link between supply chain risk and supply chain vulnerability (Christopher and Peck, 2004), although scholars use different understandings of supply chain vulnerability as reviewed by Heckmann et al. (2015). In their definitions, scholars often refer to supply chain characteristics, supply chain exposure and supply chain risk. While there have been efforts in specifying supply chain characteristics, for example, as organizational and functional conditions and practices (Barnes and Oloruntoba, 2005), certain supply chain characteristics (Wagner and Bode, 2006), such as an increased interconnectivity of the supply chain network (Kim et al., 2015) and a particular supply chain design (Wagner and Bode, 2006; Craighead et al., 2007; Bode et al., 2011; Bode and Wagner, 2015), the notion of supply chain exposure has received limited dedicated attention (e.g. Simchi-Levi et al., 2014; Heckmann et al., 2015).

Traditional supply chain risks typically emerge from cross-organizational flows of materials, information and funds (i.e. from internal manufacturing, downstream or upstream partners) or from natural disasters and man-made catastrophes such as terrorism. Risks emerging from the supply-related flow are classified as, for example, operational, endogenous or microrisks and the latter risks are synthesized as catastrophic, exogenous or macrorisks (Wu et al., 2006; Wagner and Bode, 2008; Tang and Musa, 2011; Sodhi et al., 2012; Ho et al., 2015; Wicaksana et al., 2022). Such a classification into internal and external supply chain risks, albeit sometimes with different terms, is well established in the SCRM research domain (Jüttner et al., 2003; Wu et al., 2006; Tang, 2006a; Trkman and McCormack, 2009; Olson and Wu, 2010; Heckmann et al., 2015). Recently and in the aftermath of the COVID-19 pandemic, attention has also shifted toward systemic risk and disruptions, where multiple actors and industries are globally affected simultaneously (Browning et al., 2023; Shen and Sun, 2023; Lemke et al., 2024).

In the aftermath of recent trade disagreements and conflicts between nation-states, such as Brexit and the emerging US–China trade war (e.g. Sodhi and Tang, 2021; Roscoe et al., 2020, 2022), geopolitical supply chain risks have received increased scholarly attention (Roscoe et al., 2020; Moradlou et al., 2021; Bednarski et al., 2023; Browning et al., 2023). They have been “associated with wars, terrorist acts, and tensions between state actors that affect the normal and peaceful course of international relations” (Caldara and Iacoviello, 2018, p. 2). Such risks often arise from the dependency on specific critical materials and components that are often not substitutable and the associated geographical availability of resources (Kraljic, 1983; Gemechu et al., 2015; Wiedmer et al., 2020). The health-care sector has recently been identified as particularly vulnerable to drug shortages (Badreldin and Atallah, 2021; de Vries et al., 2021) in this context. Potential reasons for these shortages are direct issues, such as manufacturing and quality problems, poor outsourcing decisions and inventories, but also quota systems and import/export regulations, which can be affected by “price, tendering and reimbursement policies” (de Vries et al., 2021, p. 1570).

Considering the features of a supply chain design that augment a firm’s vulnerability to supply chain risk, SCRM scholarship has referred to customer dependence (e.g. Hallikas et al., 2005); supplier dependence (e.g. Jüttner, 2005); supplier concentration (e.g. Tang, 2006b); single sourcing (e.g. Hendricks and Singhal, 2005b); density, complexity and node criticality (Craighead et al., 2007); horizontal, vertical and spatial complexity (Bode and Wagner, 2015), as well as global sourcing (e.g. Peck, 2006). Furthermore, the level of vulnerability also depends on the sources of disturbance (i.e. direct vs indirect sources) and categories of disturbance (i.e. quantitative and qualitative) (Svensson, 2000).

The main objective of SCRM is to build capabilities to reduce vulnerability (e.g. Jüttner et al., 2003; Wieland and Wallenburg, 2012) and costs (Manuj and Mentzer, 2008b), control and reduce negative impacts (Ho et al., 2015), improve market position (Fan and Stevenson, 2018), assure profitability (Tang, 2006a) and stabilize business continuity (Goh et al., 2007). In this context, the SCRM discourse is concerned with the identification, assessment, management and monitoring of supply chain risk (Zsidisin et al., 2005; Tummala and Schoenherr, 2011; Fan and Stevenson, 2018) through the assimilation of appropriate strategies and tools into business activities (Manuj and Mentzer, 2008b; Wieland and Wallenburg, 2012; Norrman and Wieland, 2020).

To facilitate SCRM, the pertinent literature has developed classification schemes for identifying (e.g. Christopher et al., 2011; Louis and Pagell, 2019) and assessing risk (e.g. Jüttner et al., 2003) and has examined drivers impacting the probability or impact of risk (e.g. Wagner and Bode, 2006; Ritchie and Brindley, 2007). Furthermore, scholars have outlined risk identification (e.g. Trkman and McCormack, 2009; Rao and Goldsby, 2009) and assessment approaches (e.g. Tsai et al., 2008; Knemeyer et al., 2009), risk monitoring systems (e.g. Tummala and Schoenherr, 2011), as well as various strategic and operational risk management actions (e.g. Tang, 2006a, 2006b; Manuj and Mentzer, 2008b; Tang and Musa, 2011), including avoidance, hedging and insurance, transferring, mitigation and acceptance (e.g. Jüttner et al., 2003; Zsidisin and Ellram, 2003; Kleindorfer and Saad, 2005; Ritchie and Brindley, 2007). Such approaches aim to reduce the likelihood of occurrence, the adverse effect or both (Sodhi et al., 2012; Zsidisin and Henke, 2019).

Whenever traditional supply chain risk materializes (e.g. through a supply chain disruption), the focal firm has to become aware of it (i.e. discovery process) and subsequently recover from it (i.e. recovery process) by implementing and constantly monitoring of appropriate mechanisms and techniques to mitigate the negative impacts (Blackhurst et al., 2005; MacDonald and Corsi, 2013). The latter, however, may necessitate the redesign of a supply chain, a circumstance that scholars have argued is unavoidable for an effective SCRM anyway (Blackhurst et al., 2005; Wagner and Bode, 2008; Colicchia and Strozzi, 2012). For example, to overcome the negative effects of supply chain risk, focal firms establish safeguards in the supply chain (i.e. buffering) or manage resource dependencies (i.e. bridging) (Bode et al., 2011).

A very recent variant of bridging refers to the phenomenon of friend-shoring, sometimes also referred to as “ally shoring” (Kessler, 2022; Yellen, 2022). This concept refers to a relocation of supply chains to trusted countries or countries with aligned interests and favorable politics due to growing political tensions (Kessler, 2022; Yellen, 2022). By redesigning their supply chains, focal firms can adjust their dependence on supplier resources (Skilton, 2014) and thus mitigate or even avoid risk. Relocation strategies have recently been investigated in the context of Brexit (Roscoe et al., 2020; Moradlou et al., 2021), COVID-19 (van Hoek and Dobrzykowski, 2021) or other geopolitical tensions and wars (Bednarski et al., 2023; Srai et al., 2023), acknowledging the need of higher control over critical supply chains that deliver vulnerable goods [Department for Business and Trade (DBT), 2024]. Especially shortages of drugs, blood or other pharmaceutical materials have severe repercussions so that the supply chains of these products have recently moved into focus, particularly during the COVID-19 pandemic (Badreldin and Atallah, 2021; de Vries et al., 2021). Management of these critical supply chains and sectors should therefore be a strategic and frequent exercise that applies a system view, including the cause-and-effect relationships among governmental interventions and their effects (de Vries et al., 2021). However, still “most shortages are managed reactively instead of proactively” (Ellis, 2020; de Vries et al., 2021, p. 1571).

The call toward more strategic sourcing in these areas is also well reflected through recent political initiatives, such as President Biden’s Executive Order 14017 (“Executive Order on America’s Supply Chains”) that covers six key areas, namely, “the defence industrial base; the public health and biological preparedness industrial base; the information and communications technology (ICT) industrial base; the energy sector industrial base; the transportation industrial base; and supply chains for agricultural commodities and food production” (The White House, 2021) or the European Union’s Critical Raw Materials Act (CRMA; regulation (2024 / 1252). Further recent debates revolve around strategic approaches such as completely “decoupling” from certain countries (i.e. cutting off business) or “de-risking” from certain economies (i.e. diversifying procurement) in cases of political conflict (Alabi, 2023; Bloomberg, 2023). In that vein, SCRM and supply chain (design) strategies are perceived as a “two-sided coin” (Jüttner, 2005, p. 137).

Scholarship in the SCRM research domain proposes reactive strategies, denoting approaches to respond quickly to critical situations, proactive strategies, referring to means to withstand or altogether avoid adverse events, and a blend of both (Wieland and Wallenburg, 2012; Grötsch et al., 2013). Reacting ex post to disruptions necessitates a highly agile supply chain (Hoek et al., 2001) that is able “to respond rapidly to unpredictable changes in demand or supply” (Christopher and Peck, 2004, p. 18) by adjusting operations (Gligor and Holcomb, 2012). Agile supply chain operations comprise, for example, the monitoring of evolving customer needs (Hallikas et al., 2004), postponing the configuration process (Swaminathan and Lee, 2003), and preparing business continuity (Norrman and Jansson, 2004). By proactively implementing precautionary measures, a supply chain becomes “robust” due to its “ability to cope with errors during execution” (Christopher and Peck, 2004, p. 18), thereby maintaining functionality while resisting negative impacts (Tang, 2006b). In the pertinent literature, the terms “avoidance” and “resistance” are commonly used to characterize robustness, as robust supply chains can either withstand a disruption or implement measures to prevent it (Durach et al., 2015). This incorporates, for example, a multiple sourcing (Tang, 2006b) or more generally a back-up strategy (Azadegan et al., 2013).

Supply chains strategically employing both proactive and reactive strategies are referred to as “resilient” (Melnyk et al., 2014); they are designed to be simultaneously agile and robust (Wieland and Wallenburg, 2013). Resilient supply chains are less vulnerable to disruptions and more capable to deal with their occurrence, thereby reducing supply chain risk and its impact on a focal firm’s performance (Sheffi and Rice, 2005; Ponomarov and Holcomb, 2009; Zsidisin and Wagner, 2010; Blackhurst et al., 2011; Pettit et al., 2010, 2013; Wieland and Wallenburg, 2013). Although the concept of resilience is widely used in many disciplines (Heckmann et al., 2015), a so-called engineering resilience perspective has traditionally prevailed, describing the time required for a supply chain (system) to return to its original state, supposedly optimal state (Holling, 1996). This perspective has been challenged as scholars have recognized that systems should be able to transition to new, more desirable states (Christopher and Peck, 2004; Sheffi and Rice, 2005; Ponomarov and Holcomb, 2009; Novak et al., 2021; Sauer et al., 2022). Such an ecological resilience perspective, which has evolved into a social-ecological resilience perspective, defines supply chain resilience as “the capacity of a supply chain to persist, adapt, or transform in the face of change” (Wieland and Durach, 2021, p. 316). The ability of a social-ecological system to persist, adapt and transform is particularly necessary as supply chains are embedded in a context of geopolitical and biodiversity crises (Wieland et al., 2023).

Resilience can be increased by organizational capabilities such as redundancy, flexibility and visibility (Christopher and Peck, 2004; Blackhurst et al., 2011; Pettit et al., 2010, 2013). The development of these capabilities in turn depends on the complexity of the supply chain, particularly the number of suppliers (Brandon-Jones et al., 2014), which either exacerbates the impact of a supply chain disruption or improves the recovery from it (Wiedmer et al., 2021). Other studies shed light on resilience capabilities after a disruption, including response efforts, recovery time and costs (Christopher and Peck, 2004; Sheffi and Rice, 2005). These two different perspectives on resilience capabilities in the SCM literature are also referred to as pre- and postdisruption resilience actions (Rose, 2004).

However, supply chains progressively feature “extreme conditions” (Sodhi and Tang, 2021) because their environments feature ever more disorder, including economic crises, regulatory changes and political instability (van Hoek, 2020; Browning et al., 2023). In such a world of randomness, it becomes more likely that supply chains are likewise exposed to “black swan” events, defined as unforeseeable and unique risks with a low probability of occurrence yet a high impact (Taleb, 2007; Akkermans and Van Wassenhove, 2018; Browning et al., 2023), and to “grey rhinos,” which are characterized as high-probability, high-impact threats, yet mostly neglected by practitioners (Wucker, 2016). Because SCRM scholarship often neglects the interaction between risk sources and the context in which supply chains are embedded, it possibly underestimates both the probability and severity of supply chain disruptions (Fiksel et al., 2015; Montabon et al., 2016). Scholars have emphasized that SCRM needs alternative objectives beyond costs and profits for risks that rarely happen (Tang, 2006b; Simchi-Levi et al., 2014). In that vein, “antifragility” (Taleb, 2012) is introduced to the research domain of SCM as an approach “to embrace the world of randomness.” Nikookar et al. (2021, pp. 2–3) define an “antifragile supply chain (as) a living supply chain that can gain from disorder.” Unlike robustness and resilience, an antifragile supply chain would evolve and improve with unpredictable disorder (Nikookar et al., 2021). Moreover, recent scholarship has called for integrative approaches to tackle systemic risks that transcend individual supply chains (Browning et al., 2023). Such perspectives favor a reconceptualization of resilience as capability to better prevent and manage systemwide disruptions instead of individual ones (Browning et al., 2023).

Synthesizing from prior literature reviews, including Durach et al. (2015), Fan and Stevenson (2018) and Pournader et al. (2020), to name a few, there are several avenues for future research in SCRM scholarship in empirically validating SCRM models and frameworks (Ho et al., 2015; Durach et al., 2015) and using of multimethod approaches (Pournader et al., 2020), especially beyond the first-tier level and from a “systems perspective” (Wieland et al., 2023; Browning et al., 2023). We augment scholars’ calls for research in prior literature reviews by proposing four further avenues for future research that intent to clarify prior SCRM concepts and frameworks or to explore the interaction between supply chains and their contexts. Table 1 elaborates on each of them and highlights exemplary research questions.

The maturing research field of reputational supply chain risk has gained substantial traction, with numerous articles published in the last two decades (e.g. Jiang et al., 2009; Foerstl et al., 2010; Hofmann et al., 2014; Roehrich et al., 2014; Petersen and Lemke, 2015; Hajmohammad and Shevchenko, 2020; Dhingra and Krishnan, 2021; Kähkönen et al., 2023; Hajmohammad et al., 2024). While the corresponding literature likewise uses the terms “supply chain sustainability risk,” “supplier sustainability risk” or “sustainability-related supply chain risk” (e.g. Foerstl et al., 2010; Hofmann et al., 2014; Hajmohammad and Vachon, 2016; Busse et al., 2016a; Busse et al., 2017a, 2017b; Rafi-Ul-Shan et al., 2018; Kim et al., 2019; Ngo et al., 2024), these labels are imbued with different meanings across several studies. For instance, Christopher et al. (2011) and Giannakis and Papadopoulos (2016) refer to sustainability-related supply chain risks as negative effects that firms induce on the environment and ‘society at large’. In contrast, the prevailing understanding of supply chain sustainability risk is associated with the reputational damage to buying firms caused by sustainability-related misconduct in their supply chains (e.g. Foerstl et al., 2010; Roehrich et al., 2014; Hajmohammad and Vachon, 2016; Canzaniello et al., 2017; Hajmohammad and Shevchenko, 2020), which materializes through delegitimizing stakeholder reactions (Hofmann et al., 2014). To avoid terminological confusion, we apply and propose for future research the notion of “reputational” risk, a label that unambiguously points to the causal mechanism in play, to refer to practices in a focal firm’s supply chain that stakeholders may evaluate as unsustainable, leading to damage in a focal firm’s reputation (Petersen and Lemke, 2015).

Scholarship on reputational supply chain risk has highlighted the pivotal role of stakeholders in exerting pressure on focal firms to ensure supply chain sustainability (e.g. Foerstl et al., 2010; Reuter et al., 2010; Parmigiani et al., 2011; Hartmann and Moeller, 2014). From a stakeholder perspective, focal firms occupy a crucial position in enhancing sustainability standards in their supply chains, for example, by influencing supplier behavior (Parmigiani et al., 2011; Hofmann et al., 2014), selecting suppliers that prioritize sustainable practices (Klassen and Vereecke, 2012), or developing suppliers for sustainability (Busse et al., 2016b). When focal firms neglect or tolerate sustainability-related issues in their supply chains (e.g. in supplier selection), this behavior reflects (at least to some extent) the firm’s stance vis-à-vis these grievances (Hofmann et al., 2014). Consequently, stakeholders regard buying firms as “complicit” (Mateska et al., 2023) for their suppliers’ behavior and delegitimize them for failing to address social, environmental and ethical concerns in their supply chains (Hofmann et al., 2014).

Such delegitimization results in a so-called “chain liability effect,” a term initially coined by van Tulder et al. (2009), indicating that responsibility is not only attributed by the stakeholders to the directly culpable supplier, but also to the focal firm (Lemke and Petersen, 2013; Hartmann and Moeller, 2014; Hofmann et al., 2014; Hajmohammad and Vachon, 2016; Wilhelm et al., 2016a, 2016b; da Silva et al., 2020). In essence, unlike traditional supply chain risk, reputational supply chain risk does not necessarily disrupt the supply chain, but rather emerges as a result of stakeholders’ assessments regarding the legitimacy of the focal firm, which depend on the following four-stage process: the stakeholder becomes aware of a potentially negative sustainability-related condition or event in a firm’s supply chain, assesses the condition or event as undesirable, attributes responsibility to the focal firm and deems harmful reactions to be appropriate (Hofmann et al., 2014). Importantly, focal firms are only considered legitimate if their supply chains comply with the sustainability requirements set forth by their own institutional context, typically the respective country, whereas compliance with the standards of the supplier’s institutional context may not suffice (Busse et al., 2016a).

Prior research has emphasized that stakeholders particularly attribute responsibility to buying firms in cases of severe misconduct and situations when the firm has autonomy over decision-making or outcome (Parmigiani et al., 2011; Hartmann and Moeller, 2014; Hartmann et al., 2022). However, empirical findings are again inconsistent insofar as the severity of misconduct was not found as a driver of stock market losses for the buying firms in an analysis of nearly 1,700 events (Mateska et al., 2023).

The susceptibility of a focal firm to reputational supply chain risk is conditional upon factors such as the firm’s size and visibility within the marketplace (Bowen, 2002; Parmigiani et al., 2011), its level of public attention (Grimm et al., 2016), the geographical location of its suppliers (Reuter et al., 2010), the salience of concerned stakeholders (Parmigiani et al., 2011), the specific industry context (Neef, 2004), the degree of importance attributed to the issue by consumers (Klassen and Vereecke, 2012) and the activist’s hostility (Markman et al., 2016). In contrast, according to the findings of Hartmann and Moeller (2014), consumers do not consider (primarily) the organizational distance from the supplier nor the firm size. Rather, responsibility attribution occurs when incidents are caused by suppliers as opposed to force majeure events, and when they are attributable to the firm rather than individual employees (Hartmann and Moeller, 2014).

The pertinent literature refers to various examples of detrimental stakeholder reactions, including adverse publicity, consumer boycotts, advocacy campaigns by activist groups, and strikes organized by labor unions (Busse et al., 2017b). In this context, focal firms are particularly concerned about the costs associated with the risk of adverse stakeholder reactions, including actual monetary costs and opportunity costs (Busse, 2016; Ngo et al., 2024), as well as litigation costs (Reuter et al., 2010). Specifying adverse stakeholder reactions, prior research found that sourcing from suppliers with unsustainable behavior poses a threat to focal firms as consumers tend to judge these controversial sourcing practices as unethical and may react by altering the consumption of the product (Bregman et al., 2015). Moreover, any group of stakeholders possesses “group-specific means of punishing the buying firm” (Busse et al., 2017b, p. 26).

Reputational loss leading to punishing stakeholder reactions may subsequently result in indirect effects such as lower revenues (Klassen and Vereecke, 2012) and ultimately decreased market value (Mateska et al., 2017; Kim et al., 2019; Cousins et al., 2020; Rogers et al., 2023). Measured across numerous events, it seems that the publication of news on sustainability transgressions in the sphere of the supplier leads to market value loss for the buying firm (Mateska et al., 2017; Kim et al., 2019; Kim and Wagner, 2021), with stock market reactions amplified by the influence potential of the media, the country-level sustainability risk of the supplier, and the industry-level sustainability risk of the buying firm (Mateska et al., 2023). However, the Rana Plaza factory collapse as one of the worst industrial disasters in history in terms of human lives lost did not trigger a significant stock market reaction for the involved retailers, according to Jacobs and Singhal (2017).

Reputational supply chain risk emerges from a wide range of social, ecological, economic and ethical issues within a focal firm’s supply chain (Christopher et al., 2011; Tummala and Schoenherr, 2011; Klassen and Vereecke, 2012; Hartmann and Moeller, 2014; Hofmann et al., 2014; Meixell and Luoma, 2015). These issues relate to one-time incidents as well as permanent states of undesirable sustainability-related conditions (Hofmann et al., 2014) in areas such as ecosystem impacts, pollution, waste, overuse of resources, greenhouse gas emissions, human rights, forced labor, working conditions, unethical behavior, corruption, noncompliance with laws and toxic materials (Boiral et al., 2020; Kim and Wagner, 2021; Mateska et al., 2023). Following Ngo et al. (2024), a focal firm’s performance is particularly affected by risks emanating from ecological and societal issues, in contradistinction to risks of an economic nature. However, issues around product/service quality, managerial performance or investment decisions can likewise impact reputation (Fombrun and Shanley, 1990; Petersen and Lemke, 2015). Conversely, Mateska et al. (2023) report event study results according to which social sustainability problems attract particularly much media attention, whereas governance risks (i.e. risks of an economic nature) lead to particularly strong stock market reactions for the buying firms.

The most cited paper in sustainable SCM already emphasized in 2008 that supplier management focused on sustainability occurs to a large extent from the perspective of the involved risk (Seuring and Müller, 2008). To avoid adverse stakeholder reactions, focal firms must seek at least somewhat specific reputational risk management approaches (e.g. Foerstl et al., 2010; Hajmohammad and Vachon, 2016; Canzaniello et al., 2017; Hajmohammad and Vachon, 2016; Kähkönen et al., 2023). The reason is that traditional SCRM approaches, such as supply base diversification, tend to be ineffective or even counterproductive in light of the focal firm’s risk of being delegitimized for noncompliance with sustainability requirements set by its institutional context (Hofmann et al., 2014; Petersen and Lemke, 2015; Dhingra and Krishnan, 2021).

Like traditional SCRM, the discourse on reputational SCRM is concerned with the identification, assessment, (response) management and monitoring of risks to obtain and maintain legitimacy and improve operational performance (Foerstl et al., 2010; Lemke and Petersen, 2013; Petersen and Lemke, 2015). In terms of assessing reputational supply chain risk, scholars highlight that focal firms should also prioritize sustainability misconduct that is most likely to cause damage (Harland et al., 2003; Foerstl et al., 2010). Based on the four-stage process of how reputational supply chain risks materialize, Hofmann et al. (2014) however extend the aforementioned SCRM framework by emphasizing stakeholders’ perspective in the risk management process. Subsequent research emphasized that firms should develop capabilities to identify changes in stakeholder requirements and adequately manages risks (e.g. Hallikas et al., 2020) to gain competitive advantages (Foerstl et al., 2010). Similarly, von Berlepsch et al. (2024) highlighted the importance of managing stakeholder relationships due to stakeholders’ impact on a firm’s corporate reputation.

Scholars have identified various operational and strategic approaches for managing reputational supply chain risk, namely avoidance (i.e. eliminating practices that lead to risk exposure), control or risk mitigation (i.e. reducing the likelihood that an unsustainable event occurs or mitigating the severity of a potential reputational damage), transfer or risk sharing (i.e. pooling the risk through supplier cooperation or insurance) and retention or risk acceptance (i.e. accepting the risk of reputational damage, especially when the costs of countermeasures are higher than the costs of the potential reputational damage) (Lemke and Petersen, 2013; Giannakis and Papadopoulos, 2016; Hajmohammad and Vachon, 2016). For example, risk sharing contracts in the form of compensating the supplier’s operational risk can be used to influence the suppliers’ strategies in achieving risk- and cost-reduction goals such that both reputational damage and traditional risk are mitigated (Dhingra and Krishnan, 2021).

The supply chain managers’ choices surrounding these approaches are particularly influenced by their individual perceptions of the reputational supply chain risk and the dependency structure on suppliers (Meinlschmidt et al., 2018; Hajmohammad and Vachon, 2016; Hajmohammad et al., 2024). For example, when the perceived risk is particularly high, supply chain managers prefer avoidance and collaboration strategies (Hajmohammad et al., 2024). Furthermore, in a multitier supply chain setting, mitigation practices such as direct collaboration with or monitoring of suppliers and indirect collaboration via stakeholders or monitoring via first-tier suppliers are considered appropriate (Meinlschmidt et al., 2018; Kähkönen et al., 2023). In this context, focal firms can either use their own resources (i.e. direct approach) or engage in relational and cooperative governance modes (i.e. indirect approach) (Meinlschmidt et al., 2018).

Together, these approaches apply diverse processes, mechanisms and tools, including (country-based) risk mapping, supplier monitoring, measuring supplier risks, supplier audits, exerting influence as first-tier suppliers’ within multitier supply chains, supplier development, supplier selection, phase-out strategies, (multi-)stakeholder collaboration, product quality checks, ethical sourcing, supplier codes of conduct, scenario planning and simulation, automatic fault detection and automatic recovery (Foerstl et al., 2010; Lemke and Petersen, 2013; Hofmann et al., 2014; Petersen and Lemke, 2015; Giannakis and Papadopoulos, 2016; Wilhelm et al., 2016a; Wilhelm et al., 2016b; Meinlschmidt et al., 2018; Reinerth et al., 2018; Ngo et al., 2024). Scholars highlight transparency, sustainability, as well as security efforts to mitigate reputational supply chain risks (Gereffi et al., 2022; Phillips et al., 2022). A concept that strives to combine many of the aforementioned approaches is supply chain due diligence (OECD, 2016; Hofmann et al., 2018; Schleper et al., 2022). It comprises establishing effective corporate management systems; identifying and assessing risk in the supply chain; designing and implementing risk response strategies; carrying out independent third-party audits at identified points in the supply chain; and dedicated reporting (OECD, 2016).

In cases where the efforts surrounding these reputational risk management approaches fail, meaning that an unsustainable event occurs, recent research emphasizes the need for focal firms to adopt substantive responses, rather than ignoring the unsustainable event or simply clarifying the situation (Hartmann et al., 2022). In this line of reasoning, to recover consumer purchase intentions and buffer negative consumer reactions, the focal firm should use proactive measures such as suspending contracts with the supplier that is responsible for the unsustainable event or implementing strategies for supplier monitoring or development (Hartmann et al., 2022). However, previous studies propose different response strategies. While Hartmann et al. (2022) find evidence that all three responses (i.e. suspension, monitoring and development) are similarly effective in achieving recovery objectives, other scholars recommend prioritizing monitoring and development over suspension (e.g. Jiang, 2009; Bellamy et al., 2020; Villena and Dhanorkar, 2020), although more monitoring efforts do not necessarily lead to higher levels of supplier compliance (Boyd et al., 2007).

The aforementioned notable scholarly advancements leave 14 promising avenues and opportunities for future research, in our view, that focus on managing reputational supply chain risk and acknowledge a supply chain’s environment. Table 2 provides overviews for all of them and depicts potential research questions.

The nascent research stream of societal supply chain risk, defined as “hazards that emanate from or materialize within supply chains, which primarily affect actors in the supply chain context—and possibly even humanity in its entirety” (Duensing et al., 2023, p. 3), has received little scholarly attention to date. Previous studies from other disciplines have discussed discrete phenomena that can be subsumed under the notion of societal supply chain risk, such as threatened air quality caused by suppliers in the agricultural industry using artificial fertilizers and thereby overloading phosphorus cycles across supply chains (Whiteman et al., 2013), air contaminations caused by manufacturing plants that expose populations to the risk of health problems (Ratick and Osleeb, 2013, or people who lost their homes because producers had polluted local rivers (Fisher, 2021).

Within operations and SCM research, scholars have addressed societal supply chain risk by anecdotally examining operational and supply chain decisions and practices that have detrimental effects beyond supply chain actors. Examples comprise sourcing practices that fund militias and subsequently permeate the exploitation of children (Hofmann et al., 2018), opioid epidemics intensified by production and distribution procedures (Skilton and Bernardes, 2022) and offshore production that leads to low quality drugs and jeopardizes the health care of domestic societies (Gray et al., 2011). Moreover, “carbon leakage” – in terms of supply chain restructuring and reallocation of carbon-intensive business processes to less regulated regions – renders regulations ineffective and potentially increases carbon emissions (Huang et al., 2021). Similarly, Mukherjee and Sinha‘s (2018) study of medical device industries finds that adverse user reports can trigger managerial judgment bias in product recalls which may result in avoidable injuries, hospitalization and deaths of patients. Finally, Duensing et al. (2023) highlighted that biodiversity loss can be facilitated by an exploitation of legal supply chains to smuggle endangered species and protected wildlife.

While societal supply chain risk shifts the importance of context to the effect stage, unlike traditional or reputational supply chain risk, the above examples neither pose a risk of material flow disruptions [in contrast to e.g. Wicaksana et al.’s (2022) definition of “social risks”] nor of delegitimizing stakeholder reactions. Consider, for example, the illegal infiltration of global supply chains for the purpose of wildlife trafficking. Prior research indicates that these incidents do not threaten the swift and even material flow, and that the public does not hold supply chain members, such as logistics service providers, accountable for preventing such infiltration incidents (Duensing et al., 2023). Furthermore, the lack of risk exposure explains firms’ hesitance to implement countermeasures to prevent the exploitation of their supply chains for wildlife trafficking, as implementation would incur additional costs without related benefits at the firm level. However, given that illegal poaching and trade in endangered wildlife species impact biodiversity negatively (United Nations Office on Drugs and Crime, 2020), there is a need to create “carrot or stick” solutions that encourage members of the supply chain to do more to prevent wildlife trafficking and protect biodiversity (Duensing et al., 2023).

The literature stream on societal supply chain risk is still in its infancy, offering (at least) four distinct avenues for future research. We discuss each research opportunity within Table 3, together with illustrative research questions.

We imagine future discourses in the SCRM research domain to become significant in informing interested stakeholders outside of our field about issues that are not interesting to and remain unaddressed by practitioners, for example concerning the above mentioned “grey rhinos” (Wucker, 2016). By doing so, SCRM scholarship can facilitate a process of moving away from myopic risk management approaches and of discussing obvious crises that tend to be ignored, or, metaphorically speaking, addressing the “elephant in the room.”

This research shifts scholarly attention to the role of context in the risk manifestation process – as a potential risk source for traditional supply chain risk, during the risk materialization for reputational supply chain risk, and as the locus of the risk effect for societal supply chain risk. The socioeconomic, institutional and ecological context thus connects the three research streams as our review has shown. In view of the various complex and often cross-level interactions between supply chains and the multidimensional context in which they are embedded, and which nourishes them, detailed research agendas for each literature stream are made available for future research in SCRM (Tables 1–3). Thus, this study aims to shape the future trajectory of scholarly research on traditional, reputational and societal supply chain risks and their respective management.

In practical terms, the study echoes sentiments from prior research (Hofmann et al., 2014; Duensing et al., 2023) that practicing supply chain managers should dedicate much more attention to the contexts in which their supply chains are embedded. The context of a supply chain can not only give rise to traditional risks for a firm and its performance. Rather, the behavior of the firm itself also has an impact on the context and thus attracts the attention of interest groups such as consumers, NGOs and regulatory authorities. Certain SCM practices already pose reputational risks now, and others may do so in the future. Yet other practices may not only become illegitimate but even illegal. Recent regulatory initiatives, such as the USA’s “Executive Order on America’s Supply Chains” and the European Union’s Critical Raw Materials Act (2024/1252), have highlighted the criticality of various sectors and supply chains for societies. With this in mind, sophisticated SCM in corporate practice certainly goes beyond evaluations of present-day legality and seeks to align itself proactively with ongoing and future societal needs.

Upon critical reflection, the subjectivity of our methodology represents a limitation as it can lead to bias in both the selection and representation of relevant concepts, frameworks and studies (Collins and Fauser, 2005; Dijkers, 2009; Byrne, 2016). To control such bias, we synthesized the relevant literature in a transparent manner by defining the scope and intent of this research in the methodology section (Pautasso, 2013; O’Connor and Sargeant, 2015) and by establishing various safeguarding procedures. For example, to enhance reliability, this research discussed contested findings within previous SCRM studies (Collins and Fauser, 2005; Grant and Booth, 2009) and sought to provide guidance without omitting deviating views and findings. Although we maintain that our topic profits from the broader scope and degrees of freedom of a narrative literature review (Collins and Fauser, 2005), authors who perceive the narrative literature review as such as a limitation can follow up on this investigation with a structured review of the same topics.

SCRM is a prominent topical field within the realm of SCM scholarship, as indicated by the numerous supply chain risk concepts that have been introduced and the valuable empirical results of prior studies in this domain. Our investigation contributes to the SCRM discourse, and specifically to a more holistic and comprehensive supply chain risk understanding, by synthesizing the literature pertaining to traditional, reputational and societal supply chain risk using a narrative review approach. Whereas traditional supply chain risk conceives of context as merely an operational source from which risks may emerge, the reputational and societal streams within SCRM shift the importance of context to the risk materialization and effect stages of risk manifestation. Our research built on these fundamental insights and offered an inventory of past milestones for each of these SCRM research streams. Accordingly, our article sought to provide guidance for future impactful scholarship, thereby elevating the critical role of context. The complex interaction between the material flow domain and the numerous dimensions as well as multiple levels of context should subsequently receive much more scholarly attention. To facilitate such research, we provided an in-depth research agenda, comprising 23 topical areas across the three streams of research with detailed suggestions for the study of 80 worthwhile research questions (Tables 1–3).

For instance, traditional supply chain risk research should consider the influence of factors and contexts on risk perception [Table 1 (2)]. Apart from that, current real-world developments require a closer investigation around the topics of geopolitical contexts and their management, for example through decoupling, derisking, friend-shoring and the creation of ad hoc and parallel supply chains, especially for critical goods [Table 1 (3)]. Reputational supply chain risk scholarship should, for example, explore means of ex ante prevention and management of these risks [Table 2 (1)] as well as dealing with these issues ex post, for example, through relationship repair [Table 2 (2)]. One aspect that is becoming increasingly important in reputation management is the spread of “fake news,” “deep fakes,” etc. when artificial intelligence simplifies their creation and distribution and makes them more difficult to detect [Table 2 (8)]. Furthermore, we call for more research on “unacceptable contexts” in which firms and supply chains operate [Table 2 (11)] as well as a closer normative consideration of responsibility and its boundaries in our domain [Table 2 (12)]. Finally, as societal supply chain risk is still in its infancy, we stress the importance of empirical research on societal supply chain risk examples [Table 3 (1)] as well as their management [Table 3 (2)]. There is still plenty of room for advancing knowledge on traditional, reputational and societal supply chain risks and their management.

All authors contributed equally and are listed in inverse alphabetical order.