Journal of Cleaner Production 434 (2024) 140024 Contents lists available at ScienceDirect Journal of Cleaner Production journal homepage: www.elsevier.com/locate/jclepro Review Environmental, social and governance issues in supply chains. A systematic review for strategic performance Elisa Truant a, Edoardo Borlatto a, Edoardo Crocco a, *, Nidhi Sahore b a b Università degli Studi di Torino, Torino, 10124, Italy Birla Institute of Management Technology, Noida, Uttar Pradesh, India A R T I C L E I N F O A B S T R A C T Handling Editor: Jun Bi We review recent scientific production on the Environmental, Social and Governance (ESG) framework applied to supply chain management research. In a world where increasing pressure from stakeholders has led to an intense level of attention towards sustainable supply chain practices, both scholars and practitioners have sparked the debate surrounding ESG scores and performance of supply chains. Given the novelty of the topic, along with its significance for both academia and industry, we performed a systematic literature review with the goal of synthesizing extant knowledge and providing a structured research agenda to further expand the field. We found a lively stream of research, notably focused on the need for transparency in supply chain management, the pivotal role of policymakers in driving the ESG agenda forward and the impact of ESG in the supply chain performance. In addition to providing a comprehensive, in-depth analysis of the current state of the art, with the aid of bibliometric data, we provide useful recommendations for future research by developing a structured research agenda and a theoretical framework, synthesizing extant knowledge and covering notable research gaps. The work has implications for both theory and practice. Theoretically, the research agenda acts as a starting point for further research in the field, while simultaneously providing scholars with a comprehensive snapshot of the current state of the art. From a practical perspective, the review highlights the role of managers and poli­ cymakers in implementing the ESG framework in supply chains, along with its challenges, benefits and potential drawbacks, thus acting as an informative point of reference for such implementation. Keywords: Supply chain ESG Systematic literature review Sustainable development 1. Introduction Increasing pressure from stakeholders and significant levels of environmental uncertainty (Tao et al., 2023), have led to a tremendous increase in attention towards sustainable supply chain practices. Consequently, scientific production has increasingly applied the prin­ ciples of sustainability to supply chain management (Dhir et al., 2020, 2021; Silva and Pålsson, 2022; Tandon et al., 2023), in order to evaluate how the economic, environmental and social dimensions of companies can be deemed sustainable (Koberg & Longoni.,2019; Tachizawa et al., 2014). In fact, scientific literature has closely followed the rising interest of practitioners towards sustainable supply chains, as the past decade has seen a considerable increase in contributions focusing on the matter (Agoraki et al., 2023a,b; Ozdemir et al., 2022; Ashfaq et al., 2022; Silva and Ruel, 2022). At the present day, companies cannot afford to be not sustainable, as the risks connected to lack of sustainability are now of critical importance. In the midst of sustainable supply chain literature, the ESG (Envi­ ronmental, Social, and Governance) disclosure and standards have gained global prominence, posing a set of goals for companies to strive for and for socially conscious investors to ponder their investments de­ cision upon. Additionally, ESG scores and standards have progressively become a widely accepted measure for companies to determine and monitor their sustainability performance (Dai and Tang, 2022). Since its introduction in a United Nations report in 2006, ESG has become the most widely accepted measure of firms’ sustainability and governance. Similarly, supply chain operations are also affected by ESG issues, with most Fortune 250 firms in the United States establishing various ESG goals by 2019. Additionally, the UE Directive 2022/2464 named Corporate Sustainability Reporting Directive (CSRD) published the 14th December 2022 will require, starting from January 2024, large Euro­ pean companies to regularly disclose information about their social and * Corresponding author. Corso Unione Sovietica, 218 bis, 10134, Torino, TO, Italy. E-mail addresses: elisa.truant@unito.it (E. Truant), edoardo.borlatto@unito.it (E. Borlatto), edoardo.crocco@unito.it (E. Crocco), nidhi.sahore@bimtech.ac.in (N. Sahore). https://doi.org/10.1016/j.jclepro.2023.140024 Received 30 May 2023; Received in revised form 2 October 2023; Accepted 28 November 2023 Available online 4 December 2023 0959-6526/© 2023 The Authors. Published by Elsevier Ltd. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/). E. Truant et al. Journal of Cleaner Production 434 (2024) 140024 environmental impact, promoting transparency in ESG matters and countering greenwashing (Chen and Dagestani, 2023). It applies to all large European companies, banks, and insurance companies, except for micro-listed companies. The directive expands the reporting obligation to include supply chain ESG disclosure, requiring companies to report their performance by considering their entire value chain, including suppliers. Given the increasing importance of expanding the ESG concept to supply chain management, academic research has grown in parallel to the practitioners’ rising interest in the matter. Building on such position, we believe that an effective way to contribute to the evolution of the field towards a more valuable and future-oriented discourse is to simultaneously provide clarity in what is currently being a somewhat granular and scattered field, and encourage future contributions from scholars by deriving and highlighting directions for further research. As a result, we agreed on the adoption of a systematic approach to reviewing extant knowledge on the matter, as to delineate the current scientific landscape and provide a state-of-the-art that could also serve as a reference starting point for future research, in a way that has never been done before. More precisely, while several attempts have been made to systematically synthesize extant literature on the broader stream of sustainable supply chain management (Khanra et al., 2020; Silva and Pålsson, 2022; Koberg and Longoni, 2019; Tachizawa et al., 2014), at the present time only one attempt has been made to provide a research agenda on ESG and supply chains specifically (Dai and Tang, 2022). The work of Dai and Tang (2022) is of significant value and in­ terest, yet it focused only on five journals, namely Management Science, Manufacturing & Service Operations Management, Operations Research, Production and Operations Management, and Service Science, thus leaving a considerable amount of contributions out of the scope of their analysis. Similarly, the bibliometric review conducted by Saini et al. (2022) focuses on sustainable development and non-financial disclosure, thus providing a different perspective compared to our study. Considering the relevance of these topics and the gap mentioned above, our study provides a structured research agenda, as a driver for future scientific production on ESG in supply chain management. More specifically, through a cohesive, comprehensive review of extant knowledge on the topic, an in-depth bibliometric analysis of the current state of the art is made to highlight future developments. Coherently with the aim described above, the systematic review protocol was deemed the most appropriate over other literature review approaches due to its replicability, transparency and methodological rigor, allowing research to report extant findings systematically and extensively. Additionally, such protocol allows for the inductive identification of major thematic areas, that enables researchers to derive extant knowl­ edge gaps and provide a structured research framework based upon such limitations. Our study adopts a systematic literature review (SLR) research design (Khanra et al., 2021; Chauhan et al., 2021; Zhang et al., 2022), to address the following research questions: sample, through a rigorous and iterative process of manual content analysis. The themes provide both a structured overview of existing literature, and a basis for the identification of gaps that could act as base for further research and theme-based research questions, which leads to RQ2 and the development of a structured research agenda. Finally, in order to address RQ3, we aim to develop a comprehensive framework based on the findings of the present study, illustrating the complex dy­ namics of ESG amid supply chain management, their implications for performance and sustainability, along with additional factors impacting their implementation. Our SLR provides both theoretical and practical contributions to the literature. From a theoretical perspective, we provide a structured research agenda that could provide future researchers with an overview of the stream, while suggesting areas that could benefit from further attention from scholars. In addition to our systematic review of existing literature, we provide a novel framework of ESG and supply chain management, highlighting their complex structure and how they can be used to evaluate how sustainable a supply chain is, along with the fac­ tors they help monitor. In fact, past studies have demonstrated that the SLR protocol can offer robust contributions from both a practical and theoretical perspective, that goes beyond the mere descriptive synthesis of a field, and instead sets a structured agenda for future contributions, thus aiding in the development and enrichment of a specific field. In other words, the SLR approach grants us versatility in synthesizing extant literature, and provide an extensive and updated state-of-the-art of the field, while simultaneously exploring knowledge gaps through a critical analysis. Additionally, our contribution provides practitioners with valuable practical insights as well, by highlighting the value in using ESG scores to evaluate their sustainable supply chains and how better ESG measures can be incorporated into their performance mea­ surement systems to capture sustainability performance. The research is organized as follows. Section 2 is dedicated to the connection between ESG and supply chains, which is the main focus of this SLR. Section 3 describes the research methodology, along with the steps taken to find and review the sample. Section 4 and Section 5 present the research profile and thematic areas covered in previous literature. Section 6 provides a structured research agenda based upon the findings identified throughout the analysis, while Section 7 features a theoretical framework, based on the insights gained from our extensive review of scientific production on ESG and supply chains. Lastly, Section 8 provides the theoretical and practical implications of the paper as well as its limitations. 2. Conceptual scope Before delving into the analysis of extant literature, we deem necessary to set the conceptual boundaries of the present review by looking at the definitions of the key concepts used. First, ESG is defined as a set of extra-financial factors affecting a company’s performance or overall value, either in a positive or negative way. ESG are of interest to a variety of stakeholders, both internal and external, as rising environ­ mental pressures is gradually forcing companies to actively seek a sus­ tainable path to achieve both moral responsibility and economic or financial benefit. When looking at the core definition of ESG, it can be described as a modern dimension of corporate social responsibility (CSR), albeit with a core focus on environmental impact, social re­ sponsibility (Broccardo et al., 2023), and corporate governance. How­ ever, it is important to note how ESG is not merely a performance measurement system, as it holds significant strategic value for com­ panies prioritizing sustainable development as their primary strategy. Scholarly debate has developed around whether it is wise or not for companies to focus on ESG. Research suggests that ESG is crucial when it comes to risk management, especially when it comes to financial risk (Broadstock et al., 2021; El Khoury et al., 2022). Additionally, scholars have stressed the role of ESG in alleviating financing constraints, enhancing corporate governance and creating economic value over time RQ1. What is the current state of scientific production on ESG and supply chains? RQ2. What research agenda can be drawn from limitations and gaps found in extant research? RQ3. Is it possible to provide a theoretical framework based upon extant knowledge on the topic? The use of the SLR method is suggested for research on sustainability and supply chain, as it allows researchers to gain valuable insights from extant scientific production and provide a structured agenda to help develop the literature stream. More specifically, we plan to address RQ1 by assessing the current state of research on ESG and supply chains, as we establish the most prolific authors, most impactful contributions, most relevant countries and publication outlets, thus providing scholars with a clear, comprehensive snapshot of the current state of the art. Additionally, RQ1 sees us discuss emerging themes drawn from the 2 E. Truant et al. Journal of Cleaner Production 434 (2024) 140024 throughout the past decade (Albuquerque et al., 2019; Cheng et al., 2011). More precisely, Albuquerque et al. (2019) investigated a panel of U.S.firms from 2003 to 2015 to construct an overall CSR score that took into account some of the ESG parameters as well. However, despite the more recent developments of the field, there’s currently no unanimous agreement on the correlation between ESG and risk, nor between ESG and profitability (Atan et al., 2018; Landi et al., 2022). Regardless of the discrepancies mentioned above, we believe it is safe to adopt the definition of ESG provided by Whitelock (2015), describing the concept as “a set of activity or processes associated with an organization’s relationship with its ecological surroundings, its coexistence and interaction with human organisms and other pop­ ulations, and its corporate system of internal controls and procedures to direct, administer and manage all the affairs of the organization, in order to serve the interests of stockholders and other stakeholders”. After reviewing the theoretical foundations of the ESG, we look at supply chain literature to define the conceptual boundaries of the topic. By definition, supply chains are a system of processes across an inter­ organizational network (Yazan et al., 2016). Under specific theoretical lenses, supply chains can be addressed as systems of inter-related pro­ duction processes from a materials flow perspective (Yazan et al., 2016), enabled by logistical and technological integration. Over time, the concept of supply chain has gradually broadened to focus beyond pure logistics, instead embracing more recent concerns of sustainable pro­ duction and development (Ahi and Searcy, 2013). When it comes to the integration of ESG in supply chains, major ESG index providers tend to incorporate supply chains as a metric within the “S” pillar of ESG, namely the social perspective, yet they would still treat supply chains separately from other components of said pillar (Dai and Tang, 2022). Such is the case of the Bloomberg ESG index, treating supply chains separately from other significant social components, such as human rights and discrimination (Boffo and Patalano, 2020), thus potentially misleading the public (Dai, 2020). The importance of incorporating the supply chain in its entirety is seen in the ExxonMobil case (Dai and Tang, 2022): while the company claimed a reduction in greenhouse gas emissions, while instead there was an increase in emissions, as the company was simply shifting dirty operations to supply chain partners, rather than actively diminishing them. As evidenced by the conceptual boundaries set above, the integration of ESG in supply chain management has emerged as a lively field of research, due to the relevance of supply chains in today’s globalized economy and a strong interest in sustainability from practitioners. However, given the newness of the interplay between the two concepts, the field appears vibrant and with a strong potential for growth. Consequently, having set the conceptual scope of the review, we now aim to synthesize extant knowledge on the topic and create a structured research agenda that could drive both the supply chain and the sus­ tainability fields forward. 3. Research methodology Our review adopts an SLR approach to capture, synthesize and analyze extant research on the intersection between ESG and supply chain management literature. The review identifies the research profile Fig. 1. Search protocol. 3 E. Truant et al. Journal of Cleaner Production 434 (2024) 140024 yearly scientific production. Once the sample was finalized, the authors proceeded to read and review each record in its entirety, in an attempt to get a comprehensive understanding of each article. Consequently, we adopted the use of VOSViewer and RStudio to visualize the sample in terms of research profile and most common keywords. The results of the automated analysis included information on the most influential au­ thors, annual scientific production, most relevant sources, and most prolific countries. of the topic under investigation, along with its emerging themes, liter­ ature gaps and potential avenues for further research. SLRs are widely adopted in business and social science literature due to their various advantages over traditional methods, namely replicability, transparency and reduction of human bias (Tranfield et al., 2003). Fig. 1 features a comprehensive overview of the steps taken in order to create the final sample used in the study, which we will discuss in detail below. The authors had to find the correct keywords to use for the search. To do so, we employed a three steps procedure. First, we performed a search on Google Scholar, meant to identify the most commonly used search terms in prominent literature. Second, we looked at relevant scientific outlets in both supply chain and sustainability research, in order to find reviews that used a similar set of keywords to the one we intended to use for our own study. Third, we enlisted the help of scholars and experts to help us refine our search strategy and pick the most appropriate keywords to use. Ultimately, we opted for a string composed of “ESG*" OR “Environmental Social Governance” (Tsang et al., 2023) AND “Supply Chain*” (Cardoso et al., 2023). The authors then discussed the choice of a database to extract records from. After much deliberation, Scopus was deemed the most appropriate choice. Widely regarded as the most comprehensive, Scopus is a pre­ eminent, peer-reviewed journal database (Norris and Oppenheim, 2007). Additionally, researchers often rely on Scopus to perform sys­ tematic analyses (Khan et al., 2021a), and it could allow the authors to complement previous systematic review attempts in the field (Dagestani et al., 2022). The primary advantage of Scopus is the accessibility of its downloadable database, which allows scholars to gather the biblio­ graphic information of a specific research field, encompassing journals, affiliations, citations, and references. From the process described 86 articles were obtained, from which we excluded those not related to the business and management field. Additionally, only records published in peer-reviewed English sources were considered, for the sake of data homogeneity. As a further exclusion criteria, the authors carefully examined abstracts, keywords and introductions of each record in order to compare them with the conceptual scope described in Section 2 and filter out articles that fell outside the scope. Additionally, chain refer­ encing was performed to refine the sample (Khanra et al., 2020; Khan et al., 2021b, 2023), along with the exclusion of articles not published in peer-reviewed ABS ranked journals (Akbari et al., 2022; Mitrega et al., 2022). The above brought the final sample down to 46 records. No filters were set in regards to the publication year of the records. This decision allowed the authors to have a better understanding of how the topic has evolved over time, both in terms of emerging themes and 4. Research profile We now provide an overview of the research profile of the sample. By ‘research profile’, we refer to the descriptive statistics that showcase significant information on the sample, including its yearly scientific production, the countries with the most citations, the most relevant sources, as well as the commonly used choices in research design, as depicted in the paragraphs below. We start by looking at the yearly scientific production, shown in Fig. 1. As shown in Fig. 2, a clear increase in scientific output can be observed over the past two years, with a peak of 22 articles published in 2022. The increase in scientific production can be attributed to the rising interest from both practitioners and academics to ESG, particularly in the dawn of COVID-19. In Fig. 3, we observe the distribution of the articles featured in the sample, in terms of publication outlets that featured them. Several journals have published one or more articles about the topic, thus implying a considerable degree of multidisciplinarity among the topics being analyzed. More broadly, we notice how the scope of the journals featured in Fig. 3 somewhat reflects the conceptual boundaries of our study, as it is positioned at the intersection of supply chain management literature and sustainability research. Fig. 4 provides an overview of the geographical distribution of the sample. The darker the blue, the most prolific the country has been in terms of publications. The USA dominates the sample in terms of country specific produc­ tion, albeit it is worth noting how Asian-Pacific countries have been actively contributing to the literature stream, as well as Europe. The sample features contributions from both developed and developing countries, thus suggesting a significant geographical spread in terms of academic interest. With the above in mind, a deeper comparison be­ tween contributions from developing countries and developed ones, particularly in regards to topics such as supply chain resilience and ESG standards in multinational corporate environments. Fig. 2. Yearly scientific production. 4 E. Truant et al. Journal of Cleaner Production 434 (2024) 140024 Fig. 3. Most relevant sources. Fig. 4. Geographic scope of the sample. Fig. 5 features the distribution of the methodologies used in the sample of the research. Approximately half of the research featured in the sample has been conducted through quantitative methods, mean­ while qualitative research is featured in 30% of the articles. Moreover, 12% of articles are conceptual in nature. Delving deeper into the analysis of the methodologies featured in the sample, when it comes to quantitative research design, structural equation modeling is the most common research design (Alkaraan et al., 2023; Eggert & Hartmann, 2021; Agoraki et al., 2023). In regards to qualitative research, the most common techniques used are in depth interviews and case studies (Mele and Colurcio, 2006; Brice et al., 2022; Silva and Ruel, 2022). When examining the theoretical underpinnings of the studies showcased in the sample, as depicted in Fig. 6, the majority of the ar­ ticles were not supported by popular theoretical frameworks. Still, we observed a clear predominance of the stakeholder theory, most notably, in articles focused on demonstrating the effects of the correlation be­ tween ESG and supply chain. The other theories utilized are the legiti­ macy theory, specifically linked to ESG disclosure, and the resourcebased view theory (Chand and Tarei, 2021; Whitelock, 2015; Millar and Searcy, 2020). We mentioned how the rise of sustainability as a topic in supply chain literature is partially tied to a growing awareness of the impor­ tance of ESG factors. In an effort to provide a more comprehensive un­ derstanding of how the literature stream has developed over time, the authors employed the use of VOSViewer, a software meant to create and visualize conceptual maps based upon bibliometric data. VOSViewer maps are two-dimensional, and feature the most recurring keywords found in the sample. The larger the label, the more relevant a keyword is. Similarly, the closer two keywords are, the more related they are based on the number of co-occurrences of terms in the corpus file. Two Fig. 5. Methodology distribution of the sample. 5 E. Truant et al. Journal of Cleaner Production 434 (2024) 140024 Fig. 6. Theoretical foundations of the sample. distinct analyses were carried out. The first one was meant to visualize the keyword clusters, to get a proper understanding of how the literature stream is shaped in terms of key emerging themes. Subsequently, we performed a second analysis, meant to highlight the evolution of topics over time, to visualize what topics have gained more prominence in recent years. Fig. 7 presents the co-occurrence analysis of the most frequent key­ words featured in the sample. Grounded in bibliometric data, cooccurrence analysis allows for a clearer understanding of keyword clusters featured in the sample, thus mapping the field in a coherent, transparent and replicable manner. More specifically, VOSViewer identified a blue cluster featuring keywords such as “sustainable development”, “environmental” and “sustainability”, along with the words “performance” and “financial performance”, thus demonstrating a strong correlation between sustainability and performance amid sup­ ply chain literature. Further, the red cluster features more prominent and recent trends, illustrated by the keywords “covid-19” and “climate change”. Amid the red cluster, we identified the term “ESG” and noted the relevance of ESG standards in more recent scientific production and, more specifically, times of profound uncertainty. The above correlation is further supported by Fig. 8, as we highlighted the recent growth in relevance of ESG specific research. Finally, the green cluster highlights the correlation between environmental concerns and corporate gover­ nance, featuring keywords such as “social disclosure,” “environmental,” and “corporate governance”. Researchers used VOSViewer to perform a keyword analysis featuring the development of keywords over time, displayed in Fig. 8. Fig. 8. Keywords Evolution over time. Results highlight how the focus has progressively shifted towards human and ethics centric topics in recent years. From 2014 to 2018, research was focused on topics such as “Corporate Governance”, “Environment” and “Management System”, possibly suggesting a stronger emphasis on core business and management topics, rather than broader sustainability literature. In fact, the findings of Shrivastava and Addas (2014) stress how a more attentive corporate governance fosters higher sustainability ratings, which consequently heightens the likelihood of businesses embracing sustainability initiatives. Companies nowadays operate in a world in which climate change is actively affecting their operations, a world in which employee health and safety hazards are critical concerns, potentially leading to disruptions in supply chain and delivery networks, and erratic and progressively unstable commodity prices (Kovács and Falagara Sigala, 2021). In such a scenario, corporate governance should operate with sustainability benchmarks in mind. Additionally, in an effort to promote environmental awareness, companies should consider relying on independent board advisors, who have no vested interest in the firm’s financial profitability, thus warranting unbiased feedback. More recent academic production shifts the attention towards the rela­ tionship between ESG and financial results, as shown by the presence of “Finance” as a main keyword in years 2019 onwards. In fact, scholars agree on how corporate governance is vital when managing and implementing ESG guidelines (Sancak, 2023). Agoraki et al. (2023a,b) shows that a low level of ESG reputational risk is directly associated with an increase in financial performance. Their findings expand upon the ones of Shrivastava and Addas (2014), as they explore the perspectives of board advisors having direct stakes in the financial performance of Fig. 7. Graphical representation of the keyword clusters. 6 E. Truant et al. Journal of Cleaner Production 434 (2024) 140024 their company, highlighting how it is in their best interest to directly monitor the ESG performance of their organization. The most recent cluster of keywords shows topics related to the recent pandemic, as the keyword “Covid-19” demonstrates. COVID-19 has highlighted the need for companies to prioritize sustainability and long-term, sustainable development. Policy intervention is crucial to establish suitable in­ centives for both demand and supply, thereby further promoting green securities (Agoraki et al., 2023a,b; Wang et al., 2022). Additionally, COVID-19 has had an impact on the performance of green investment funds; in this regard, Selmi et al. (2022) shows that it is imperative for policymakers to establish incentives to support both the demand and supply of green securities as a method to recover from the post pandemic crisis. making sure all processes needed, whether internal or external, including those supply chain related, are sustainable. The duty of Corporate Social Responsibility (CSR) managers now places greater emphasis on external pressures rather than internal ones (Chen et al., 2023; Sancak, 2023). 5.2. The impact of ESG reputational risk on economic performance We preface the section by illustrating how scholars have generally investigated the impact of ESG reputational risk on economic perfor­ mance specifically, even though multiple types of performance exist when it comes to ESG. For instance, ESG performance itself has become a criterion for measure environment and social responsibility of com­ panies (Zeng et al., 2022). Additionally, operational performance is an equally significant aspect of ESG adoption, and has been investigated through the lens of circular economy and Industry 4.0 (Behl et al., 2023). Yet, the impact of ESG policies on specific outcomes such as operational efficiency, and customer retention remain partially unex­ plored to this day, thus warranting further exploration in the future. Scholars generally agree on the fact the risks of not being sustainable is critical for several clusters of supply chains (Rajesh, 2020). The research conducted by Imperiale et al. (2023) has established a corre­ lation between ESG reputational risk and decreased performance. ESG reputational risk is associated with the recent trends of stakeholders wanting firms to be as transparent as possible when it comes to responsible accounting and ESG performance (Agoraki et al., 2023a,b). As such, the ESG reputation is of utmost importance for a modern company, to the extent that when said reputation is at risk, overall performance of a company might suffer. The above can be explained through the theory of asymmetric information of George Akerlof, Michael Spence, and Joseph Stiglitz, according to which the presence of ESG reputational risk may lead to asymmetry of information between stakeholders and management, consequently resulting in the so called negative selection, causing an increase in the cost of equity, and ulti­ mately leading to poor economic performance (Rosser et al., 2003). Additionally, the market may perceive ESG exposure as a negative signal for the company’s reputation. The study conducted by Agoraki et al. (2023a,b) delves into the correlation between ESG informational risk and a firm’s economic performance, considering the effects of the 2014/95/EU directive and the COVID-19 pandemic. The findings show that a company’s economic performance is negatively impacted by ESG reputational risk, regardless of whether the information asymmetry has been reduced. Additionally, the study of Shu and Tan (2023) that examined the effect of ESG factors on corporate financial performance found that carbon control policy risk has a negative effect on ESG per­ formance. In their analysis, Shu and Tan (2023) stress the importance of carbon control policy risk management, calling for a joined effort of both companies to actively work towards said objective, and governments to financially support their transition towards socially responsible activities. Additionally, the implementation of a sustainable supply chain management (SSCM) system can lead to improved performance and reduced ESG reputational risk (Tamayo-Torres et al., 2019). Despite limited research on the role of ESG in evaluating the performance of green supply chains, financial reports of listed companies worldwide are increasingly starting to include that type of information (Zeng et al., 2022). An evaluation model that incorporates ESG factors in the assessment of green supply chain performance can fill the research gap, thus offering a new perspective for global supply chain management, publicly traded companies, and stock markets. Furthermore, collabora­ tion among internal departments, environmental management systems, and partnerships with suppliers and customers are crucial for the success of GSCM in small and medium-sized enterprises (Bag et al., 2022). Other studies have also stressed the importance of managing ESG country risk for promoting long-term corporate profitability and investment perfor­ mance (Zumente and Bistrova, 2021). 5. Emerging themes in supply chain and ESG literature In order to make better sense of the sample, we conducted an indepth, qualitative content analysis to extract emerging themes, priori­ tizing those among which scientific debate has focused the most. In order to accomplish this task, the authors independently read each re­ cord, and performed both open and axial coding to identify antecedents and outcomes of the ESG integration amid supply chains. Results were subsequently consolidated by a panel of experts in the field and led to the identification of the following three thematic foci: (a) transparency in supply chain management, (b) the impact of ESG reputational risk on economic performance, (c) the role of policymakers and institutions. 5.1. The role of ESG transparency in supply chain management While the topic of ESG transparency is complex and involves multi­ ple factors, such as the quality of the ESG data being collected, organi­ zational culture, and monitoring processes, scholars have often focused on ESG disclosure specifically, interpreted as a sign of increasing importance governments and regulators put on ESG transparency (Yu et al., 2018). Literature shows that better ESG disclosure practices can increase corporate transparency and enhance a company’s reputation, which can lead to a lower cost of debt and increased financial perfor­ mance (Gao et al., 2022) The strong correlation between financial per­ formance and ESG disclosure has also been shown in the keyword analysis presented earlier in the manuscript. Scholars have focused on the interplay between the density of the supply chain, the concentration of suppliers, the geographical diversity of the supply chain, and the overall level of transparency within the supply chain (Gualandris et al., 2021). The above interplay highlights how transparency in a supply chain is a multi-faceted, complex outcome influenced by the structure of the supply chain itself. With regards to ESG disclosures, the intricacies of the relationships between supply chain members can lead to varying levels of transparency in a supply chain (Gualandris et al., 2021). Previous research reveals that the geographical diversity of a supply chain only partially affects its level of transparency. Risk Management scholars have demonstrated that the complexity of heterogeneous sup­ ply chains can obstruct the achievement of meaningful collective out­ comes, including transparency. Additionally, they demonstrate how the above is the resultant of the challenges deriving from adapting practices that are tailored to specific institutional and contextual conditions (Heckathorn, 1993; Poteete and Ostrom, 2004). Overall, transparency is becoming increasingly crucial for supply chains, as more and more companies strive for it instead of relying on opaque certification labels (Sancak, 2023). ESG disclosure can help improve transparency and communication between companies towards sustainable development, adopt a comprehensive approach that tran­ scends simple monitoring, examine beyond just the primary suppliers, incorporate sustainability into the very foundations of your business operations and promote transparency throughout the entire supply chain (Gualandris et al., 2021). In other words, the focus has shifted from making sure a company’s internal processes are sustainable to 7 E. Truant et al. Journal of Cleaner Production 434 (2024) 140024 Another cause for improved results could be, in fact, the company’s ability to execute socially and environmentally responsible supply chain practices within a well-established system. In other words, organiza­ tional maturity may lead to benefits such as increased returns, financial rewards, accolades, and recognition (Saini, 2022). Consequently, studies of sustainability transformation processes highlight the importance of governance in ESG implementation (Khalid et al., 2022; Whitelock, 2015). A sequential sustainability transformation model (STM) has been developed by Sancak (2023), with the intent of focusing on the processes of transforming towards sustainability companies and supply chain, utilizing the ten-step model of Stouten et al. (2018). Given the complexity of implementing sustainability practices among organiza­ tions effectively, the model has been established utilizing ten key, evidence-based steps in managing planned organizational change as a foundation. The STM categorizes the transformation steps into ESG factors. ESG factors are the primary considerations in the process of sustainability transformation (Kotsantonis et al., 2016). Nonetheless, incorporating ESG factors into planned organizational change can be unclear for businesses (Sancak, 2023). 6. Research framework and future directions After performing an extensive literature review on extant knowledge on ESG and supply chain, we attempt to synthesize said findings in a conceptual framework that could encapsulate the multifaceted nature of the topic. Our review highlights the existence of a normative level of ESG, in which companies align themselves with requests posed by reg­ ulators merely on a legislative basis, and of a business model level, in which ESG are comprehensively and seemingly embedded in a com­ pany’s supply chain and value creation process. While several factors and dynamics have been investigated at length by previous work, for instance transparency in ESG disclosure and supply chain density (Gao et al., 2022; Gualandris et al., 2021), there are several gaps that might still require further scientific research to fully explore them. Conse­ quently, we adopt the research framework to comprehensively capture the nuances of the field and highlight the underlying dynamics uncov­ ered in our SLR. The framework is featured in Fig. 9. When interpreting the framework we developed above, it is impor­ tant to note that supply chain structures vary greatly from country to country, from sector to sector. Consequently, it is advisable to keep in mind that the scenario is complex and multifaceted, thus hard to generalize. Generally speaking, the structure of a supply chain has been proven to be affecting ESG performance in a number of different ways. For instance, supply chain density might have a positive effect on transparency, whereas supply chain clustering might have a negative effect on it. In other words, when looking at the impact of ESG on supply chain design, we note the effects on transparency, density and the consequent levels of environmental impact (Gao et al., 2022; Gualandris et al., 2021). However, further research in this direction can be of great use as a few contradictions still exist. For instance, best-in-class companies with low ESG reputational risk might underestimate the need for them to be as transparent as their peers. Thus, further research could explore the perspectives of different companies depending on their role in the market, whether leaders or followers, and investigate potential dissim­ ilarities when it comes to transparency. When looking at the impact on the company as a whole, we note how ESG disclosure can emphasize sustainability performance measurement (Dai and Tang, 2022). Addi­ tionally, it might lead to preferring a governance structure that is more attentive to ESG and sustainable development (Khalid et al., 2022). In this regard, further research is needed to explore ESG disclosure as a practice and, more importantly, how policymakers and regulators can facilitate ESG disclosure to the point companies see competitive and strategic value in it, rather than a mere inconvenience. For instance, Reid and Castka (2023) stress the importance of avoiding fragmentation of efforts and lack of coordination between companies and regulators, which may lead to opportunistic behavior. Finally, our framework highlights how the UE Directive 2022/2464, namely CSRD, will require, starting from January 2024, large European companies to regularly disclose ESG information. Hence, our framework posits that scholars must examine the above developments closely, in an effort to investigate if and how ESG is embedded in companies’ value chains, moving past the sheer normative level and entering the integrated business model level. In other words, future research should investigate how ESG standards get progressively integrated into business models, as regula­ tors seemingly continue to work towards a more geographically exten­ sive implementation of ESG. 5.3. The role of policymakers and institutions The majority of recent papers are mainly focused on the environ­ mental impact of supply chains, especially those written after the pandemic period. Additionally, the focus has recently shifted towards the role played by policymakers and institutions in ESG and supply chain management. The study conducted by Sancak (2023) sheds light on ESG-based sustainability change using management language and showing the requirement for improved metrics to evaluate governance factors. Consequently, Khalid et al. (2022) argue that governance structure should be a priority for authorities and policymakers wanting to achieve sustainable results through ESG disclosure. This will contribute to achieving sustainable outcomes and increased ESG disclosure practices (Khalid et al., 2022). Additionally, COVID-19 has highlighted the need for companies to prioritize sustainability and long-term, sustainable development. In order to obtain a more sustainable approach, it is now clear that it may be required to implement policy intervention in order to establish suit­ able incentives for both demand and supply, thereby further promoting green securities (Agoraki et al., 2023a,b). As we stated earlier, COVID-19 has had an impact on the performance of green investment funds; consequently, Selmi et al. (2022) stress how it is imperative that policymakers establish incentives to support both the demand and supply of green securities. Through the use of Industry 4.0 technologies and circular economy (CE) techniques in sustainable supply chain and inventory management practices, sustainable performance is achiev­ able, and so is competitive advantage, even amid uncertainty. Furthermore, the study of Alkaraan et al. (2023) provides validation for the perspective of Jabbour et al. (2019). Their study presents a technological blueprint and framework for boardrooms to foster CE through innovative approaches, strategic thinking, and the advent of business model transformation. The discussions supporting the findings of Alkaraan et al. (2023) are relevant to the Sustainable Development Goals (SDGs) and provide valuable intuition to governance, share­ holders, regulatory agencies, and all the other entity related to the company regarding the forecasted effect of Sustainable and Strategic Industry-Driven Material Planning. Nevertheless, the correct execution of Strategic Industry-Driven Material Planning and the attainment of green achievements, requires in-depth stakeholder engagement, for instance, through the evaluation of investment prospects by stake­ holders. This approach will motivate Strategic Industry-Driven Material Planning driven by stakeholder interests and requirements, leading to an enhanced environmental innovation solution that supports the SDGs (Alkaraan et al., 2023). 6.1. ESG and supply chain performance The sample shows the relationship between supply chain structure, ESG focus, and company performance, while also highlighting the impact of human behavior and intention. These findings underscore the complexity of a company as a system where cause-and-effect links can be elusive. More specifically, according to the literature, further investi­ gation is needed into the effects that the Total Quality Management 8 E. Truant et al. Journal of Cleaner Production 434 (2024) 140024 Fig. 9. Conceptual framework. (TQM) model (Lim et al., 2022), the Theory of Planned Behavior (Stouten et al., 2018), and the Mitigation Effect (Caiazza et al., 2023) have on supply chain management and ESG. With regard to the TQM, there is the need to expand the knowledge through quantitative studies that involve a significant sample size (Lim et al., 2022). The above is especially relevant in the context of present literature, as ESG and TQM are often seen as independent of one another due to the outward focus of ESG and inward focus of TQM, yet the field would benefit from contri­ butions expanding upon the synergies of the two mechanisms. Furthermore, the TPB framework (Ajzen, 1991) can be used to investigate variables that contribute in accepting and implementing change (Jimmieson et al., 2008). The TPB has demonstrated reliable results in individual behavioral change, as noted by Hardeman et al. (2002), and in understanding organizational adjustment such as implementation of evidence-based practices (Rousseau and Gunia, 2016). It is, therefore, crucial to explore the factors that contribute to the organization’s ability to implement change in sustainable supply chain management. Additionally, the mitigation effect is worthy of further attention when it comes to ESG and supply chain research (Hsueh, 2019). Caiazza et al. (2023) considered the effect on global warming mitigation resulting from a proper integration of ESG and supply chain management so significant that they emphasized the need for further studies to highlight and quantify this phenomenon. As presented by the study conducted by Wang and Sarkis (2013), in order to obtain effective methodologies of analysis about the environmental effects of the supply chain, it will be necessary to use artificial intelligence. In fact, AI tech­ nology could allow us to analyze all the components of this complex system simultaneously, thus filling many of the current limitations related to the study of this topic. interconnections between each of the ESG pillars and supply chain management, thus leaving room for further contributions to provide a more comprehensive and synergic look at the matter. More specifically, previous studies corroborated the importance of the “S” in ESG, especially in terms of gender equality, cultural diversity, and supply chain management (Baid and Jayaraman, 2022; Newell, 2023). For instance, future research could expand upon the model developed by Baid and Jayaraman (2022), and empirically measure social impact within the supply chain in diverse sets of data. Further­ more, scholars could answer the call made by Newell (2023), and develop additional levels of metrics for the “S” in ESG. Further research could also explore the moderating effect of the buying power of the firms and experience with environmental purchasing and supplier manage­ ment (EPSM) activities and sustainable supply chain collaborations (Chauhan et al., 2022) to gain a more comprehensive understanding of the significance of these interactions including social exchanges with micro-level influencers (Ojha et al., 2023). Here, the buyer-supplier knowledge transfers and acquisitions, which are important in sustain­ ing social performance improvements (Awan et al., 2020) can also be explored in greater detail. In conclusion, there is a need to devise new models that establish the relationships between key actors in modern research such as digital transformation, ESG, and supply chain management. Further big data applications to digitalize the associated processes should also be explored (Khanra et al., 2020; Talwar et al., 2021). In fact, scholars generally agree on the immense potential digital transformation has in terms of driving forward sustainable development in a variety of ways, for instance by enhancing the monitoring and tracking of the environ­ mental performance of companies and countries alike. As such, there is ample space for both policymakers and scholars to intervene, possibly with the intent of bridging the digital divide and ensuring everyone can benefit from the advancements of digital transformation. Implications are significant for every aspect of ESG performance. Environmental wise, digital technologies can enhance monitoring and tracking of the impact subjects have on the environment. From a social and governance perspective, digital platforms can provide a better distribution and accessibility of services, namely access to digital healthcare and edu­ cation, to a larger percentage of the population. Additionally, digital platforms can also help in terms of transparency and disclosure, as they have the potential to power and signal boost the diffusion of ESG 6.2. New models and interactions between the E, S and G pillars A second broad area for future research involves examining the connection between supply chain and ESG standards, while considering the latter as made of three distinct and interdependent pillars. Research that examines the interplay between ESG factors, such as the impact of environmental factors on social or governance factors and vice versa, has the potential to provide greater clarity to the field of sustainability transformation guided by ESG principles (Selmi et al., 2022). Never­ theless, extant research has focused somewhat narrowly on the specific 9 E. Truant et al. Journal of Cleaner Production 434 (2024) 140024 performance statements across the globe through the tools of the Internet. use of the TQM model (Lim et al., 2022), the Theory of Planned Behavior (Stouten et al., 2018), and the Mitigation Effect (Caiazza et al., 2023) on supply chain management (Sharma et al., 2023) and ESG. A further area of research could delve deeper into the ESG standards, in an attempt to analyze the interplay between each of the three pillars separately. For instance, it would be interesting to examine how environmental factors influence social or governance factors and vice versa (Selmi et al., 2022). Additionally, informational asymmetry persists among companies that disclose ESG information, thus being a further area of exploration in the literature on supply chain management and ESG (Agoraki et al., 2023a, b). Finally, we contribute to the literature by providing a comprehensive conceptual framework featuring several variables and correlations, meant to better understand the several facets and intricacies of ESG and supply chain management. The framework has been synthesized from extant knowledge featured amid the sample and provides a bird’s eye view of the field, thus indicating areas that are both underdeveloped or fully unexplored. In our intentions, the framework could act as a base for further research, thus aiding scholars in designing future contributions to the field and contributing to theory by providing a bird’s eye view of the field. Additionally, still in regards to future research, our biblio­ metric analysis provides scholars with a clear snapshot of the current state of the art in terms of most relevant publications outlets (Bhatt et al., 2020), thus aiding them in their choice of positioning when it comes to their scientific production. 6.3. Information asymmetry Although policymakers have begun to produce regulations, such as the European Sustainability Reporting Standards (ESRS) adopted by the European Commission and produced by the European Financial Reporting Advisory Group, informational asymmetry persists among companies that disclose ESG information. This is due to the absence of strict rules and the flexibility in the level of detail and quality of infor­ mation provided, as noted by Agoraki et al. (2023a,b). Despite the fact information asymmetry can be lowered with a more significant commitment to ESG disclosure (Landi et al., 2022), the topic is still actively debated by scholars attempting to capture the reasons behind its persistence. For instance, quantitative research might delve deeper into the impact of ESG practices on information asymmetry, as to determine whether unveiling voluntary/mandatory non-financial information equates to a reduction in asymmetry (Saini, 2022). Additionally, future research may explore the influence of sustainability information that conforms to guidelines established by organizations such as the Carbon Disclosure Project, Climate Disclosure Standard Board, Global Reporting Initiative, International Integrated Reporting Council, and Task Force for Climate-Related Financial Disclosure on firm valuation, as noted by Eng et al. (2022). Standardization of sustainability reporting can only be achieved through the adoption of a universal set of standards. Therefore, examining the various outcomes associated with different evaluation methods is critical in the formulation of new legislation or directives. The above line of research can prove extremely valuable for policy­ makers and practitioners, due to its relevance and practicality. 7.2. Managerial implications Our review comes with several implications for practitioners. First, our work emphasizes the importance of corporate governance and pol­ icymakers in achieving sustainable supply chains, through the use of ESG (Mudulikanta et al., 2020). More specifically, our review has highlighted the importance of improved metrics that could drive the change towards sustainable development (Sancak, 2023) and how governance structure is pivotal when discussing sustainability goals through ESG disclosure (Khalid et al., 2022). Consequently, we suggest top management acknowledges the importance of ESG and moves past the normative level, to instead properly and extensively incorporate ESG amid their entire business model, in an organic and comprehensive manner. In other words, ESG should not merely be a set of rules to abide by for the sheer sake of regulation, rather a strategic and core compo­ nent of the corporate vision. More specifically, our work addresses the increased attention from stakeholders and practitioners towards green management practice and concepts (Khan et al., 2023; Singh et al., 2021). It does so by stressing the importance of top management support when implementing green supply chain management practice (Khanra et al., 2020; Mudulikanta et al., 2020), as their motivation, in conjunction with their scope of action, is pivotal for a true and extensive implementation of ESG in supply chains. In other words, the “human” element is vital (Vázquez-Brust et al., 2022), as a concerted effort from stakeholders, aided by a more open and attentive attitude from top management is key for sustainable supply chain practices (Stefanelli et al., 2021). Further, our review strives to spread awareness on the matter of transparency and, more specifically, how nuanced, yet significant is the connection between ESG disclosure, supply chain structure and trans­ parency (Gualandris et al., 2021). Transparency requires the engage­ ment of multiple stakeholders, along with taking social accountability for, among others, working conditions within suppliers (Silva and Ruel, 2022). Consequently, we recommend supply chain professionals pub­ licly disclose information on their supply chain partners, thus fostering a transparent environment to benefit from increased scrutiny, albeit they should still be mindful of the risks connected with excessive disclosure of sensitive information (Gualandris et al., 2021). Additionally, in an effort to secure a significant competitive advan­ tage, supply chain professionals should be mindful of the ESG 7. Study implications 7.1. Theoretical implications Several contributions to theory have been made with the present review. More precisely, by conducting a systematic review of supply chain and ESG literature, we provide three distinct theoretical contri­ butions. First, our study contributes to theory by synthesizing and organizing extant literature on ESG and supply chain into distinct themes, thus acting as both a snapshot of the current state of the art, and a starting point for further research. The above can be useful to scholars, as they can now make more informed decisions as to how and where to position their research. We have accomplished the above task by both examining the most relevant keywords through the use of automated analyses, and we performed qualitative coding to draw main themes from the sample. Based on our classification of the sample, we find that ESG can play an important role in fostering supply chain transparency and communication (Behl et al., 2023), as an increasing number of companies strive to enhance the effectiveness and transparency of their communication with both stakeholders and peers (Sancak, 2023). Additionally, we note how ESG reputational risk may significantly affect a company’s performance (Tamayo-Torres et al., 2019). In the above regard, the adoption of sustainable supply chain practices can help mitigate ESG reputational risk (Saini, 2022), thus improving perfor­ mance. Finally, we highlight the role of policymakers and institutions, deemed pivotal by several works. Through a more intensified use of ESG disclosure, policymakers and institutions can potentially prioritize sus­ tainability and long-term, sustainable development for their supply chain (Khalid et al., 2022), provided their governance prioritizes the ESG accordingly. A further theoretical contribution is provided by systematically uncovering the crucial research gaps found in the literature. Having developed a structured research agenda can be of great value for theory, as it could act as a starting point for future research endeavors in the field. From a theoretical perspective, further research could explore the 10 E. Truant et al. Journal of Cleaner Production 434 (2024) 140024 reputational risk connected to disclosure of unreliable information (Imperiale et al., 2023). Granted that lower ESG reputational risk is a catalyst for any company’s performance (Agoraki et al., 2023a,b), reg­ ulators should consider pricing ESG correctly to motivate companies to engage more in ESG disclosure (Shu and Tan, 2023). Currently, best-in-class companies have little to no incentives to engage in ESG disclosure due to the lack of perceived reputational risks (Imperiale et al., 2023). Thus, regulators should consider stepping in, to make sure ESG disclosures become more effective for companies, along with their shareholders and stakeholders (Shu and Tan, 2023), possibly by strengthening their link with the value-generating process of the com­ pany itself. Finally, our SLR highlights the potential for ESG disclosure to help eliminate information asymmetry, thus giving managers insight on how to develop policies on value disclosure systems (Dagestani and Qing, 2022; Saini, 2022). By prioritizing ethical and social components, managers can contain firm-level risk and promote long-term value cre­ ation, which has become increasingly imperative in recent years, espe­ cially in the dawn of the pandemic (Landi et al., 2022). Even though the scholarly debate is still very much open at this point, our work en­ courages managers and practitioners to put greater attention on the matter of information asymmetry, specifically in light of the benefits they would gain from symmetric disclosure. stream has developed and evolved over time. Finally, human error should always be kept in mind when analyzing an SLR. In our case specifically, we might have missed out on certain records or failed to highlight certain aspects of the sample others would deem relevant. Thus, we call for further SLRs to validate or invalidate our analysis of the literature, and compare our interpretations of the findings with theirs. Declaration of competing interest The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper. Data availability No data was used for the research described in the article. Acknowledgments Authors have no Acknowledgments to disclose. References Agoraki, M.-E.K., Aslanidis, N., Kouretas, G.P., 2023a. How has COVID-19 affected the performance of green investment funds? J. Int. Money Finance 131 (102792), 102792. https://doi.org/10.1016/j.jimonfin.2022.102792. Agoraki, M.-E.K., Giaka, M., Konstantios, D., Patsika, V., 2023b. 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Conclusion, limitations and future directions With the present SLR, we set out a goal to critically synthesize extant knowledge on ESG in supply chain management, thus providing scholars with both a snapshot of the current state of the art, and a research agenda that could drive forward the literature stream. While a previous attempt to systematically review the literature has been made (Dai and Tang, 2022), ours expands upon the previously published literature re­ view by featuring a broader scope of journals and overall sample. Three main research questions drove our SLR, to which we answered as dis­ cussed below. In response to RQ1, we provided scholars with a comprehensive snapshot of the current state of the art in ESG and supply chain man­ agement. To do so, we both provided a comprehensive research profile based on bibliographic information, and an in-depth qualitative analysis meant to highlight emerging trends and themes among the sample. Consequently, RQ2 saw us delving deeper into the sample and adopting a more nuanced, critical approach in order to uncover extant gaps and points of scholar debate. To achieve the above end, we explored the limitations in the literature and attempted to provide readers with a few recommendations in regards to possible future research directions. To answer RQ3, we developed a conceptual framework that could encap­ sulate the nuances of ESG in supply chain management, thus high­ lighting their multiple dimensions and intricacies. In our intentions, the framework could serve as the basis for future research, thus theoretically underpinning future development in the field of supply chain and ESG. SLRs are rigorous, transparent and highly replicable choices in research design. However, a few caveats should be considered. The first limitation has to do with the sampling and, more importantly, the de­ cision to exclude articles published in journals not published in peerreviewed ABS ranked journals. While the choice was deemed neces­ sary for the sake of quality and academic soundness of the sample, we might have failed to review relevant contributions published in non-ABS ranked journals, conference proceedings or as book chapters. Conse­ quently, future SLRs could amend the above limitation by expanding the scope of our review and incorporating more sources. Second, we made use of Scopus only when retrieving the sample. Thus, still for the sake of broadening the scope of our SLR, future reviews could consider other databases, which may yield additional records not reviewed in the present study. Similarly, as the literature on the topic grows, future studies could adopt a bibliometric approach and review extant knowl­ edge from a broader perspective, thus exploring how the literature 11 E. 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