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Sustainable Supplier Evaluation: From Current Criteria to Reconstruction Based on ESG Requirements

Author

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  • Shuqi Lou

    (School of Economics and Management, Tongji University, Shanghai 200092, China)

  • Xiaoyue You

    (Sino-German College of Applied Sciences, Tongji University, Shanghai 200092, China)

  • Tao Xu

    (School of Economics and Management, Tongji University, Shanghai 200092, China)

Abstract

The disclosure of ESG tasks, seen as companies’ performance of sustainability, has gradually became a necessity for listed enterprises. From an ESG perspective, this paper revisits and restructures the sustainable supplier evaluation criteria. Leveraging thematic analysis, this study dissected ESG reporting guidelines across stock exchanges and explored ESG annual reports and supplier codes of conduct from the listed firms. This elucidated the evaluation criteria currently in practice. The findings indicate that existing sustainable supplier evaluations cannot fully meet ESG regulatory requirements. Drawing insights from these gaps, we reconstructed the evaluation criteria through text analysis to better align with ESG mandates. This study introduces the concept of a “Relative Word Frequency Ratio” to analyze the importance of each indicator and to further determine which to retain or delete. This research offers a robust theoretical foundation and practical guidance for enhancing supplier sustainability evaluations, and the proposed sustainable supplier evaluation criteria system could provide a decision-making reference for enterprises in the choice of ESG-qualified suppliers.

Suggested Citation

  • Shuqi Lou & Xiaoyue You & Tao Xu, 2024. "Sustainable Supplier Evaluation: From Current Criteria to Reconstruction Based on ESG Requirements," Sustainability, MDPI, vol. 16(2), pages 1-23, January.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:2:p:757-:d:1319876
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    References listed on IDEAS

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