136
U. Awan et al.
2018b). Sustainability in corporate responsibility is being recognized as a doubleedged sword to spur sustainable development in the global world. It has also been
argued that sustainability might create better opportunities for future generations
by minimizing harms inflicted by the economic development of the natural system
(Bansal and Song 2017). The literature provides evidence supporting the idea that
corporate sustainability practices (CS) overlap with corporate responsibility (CR).
Corporate responsibility may include or exclude sustainability philosophy. Given the
importance of the social issues in literature, the most important dimensions related
to them include: workplace accidents (employee absenteeism), fair work practices
(number of new jobs created by the adoption of new technology) and community
development. Socially sustainable development is an important factor concerning
not only sustainable development but also the issues related to human development
in all facets of life and development of a socially sustainable system.
3 Literature Review and Hypothesis Formulation
The debate over the socially sustainable development issues has been inextricably
associated with the wide-ranging discussion about the type of governance suitable
for firms. Manufacturing firms face these challenges in both domestic and international arenas for growth that is as socially, and environmentally friendly as possible
and respective harnessing of opportunities offered by the governance mechanisms.
Governance mechanism ensures that firms can cope with social sustainability supply
chain issues (Gimenez et al. 2012). Previous research explored the relationship
between contractual and relational governance in governing business transactions and
reducing conflicts or opportunism (Jap and Anderson 2003; Poppo et al. 2008; Huang
et al. 2014); relationship effectiveness (Wagner 2011; Cao and Lumineau 2015) and
commitment (Sancha et al. 2016; Awan et al. 2018b). In relational governance (RG),
the inter-firm relationship is largely regulated by the division of tasks, social norms
and ties (Poppo et al. 2008; Zhou and Xu 2012). The contractual (transactional)
governance means governing transactions through contractual safeguards (Ferguson
et al. 2005). The governance context, in turn, is concerned with the characteristics
of specific knowledge and exchange of information with other supply chain partners
used to improve the firm’s performance. For instance, (Formentini and Taticchi 2016)
underscored the importance of linkages between the governance mechanism and
corporate sustainability approaches for the improvement of sustainability initiatives.
Athaide and Klink (2009) governance approaches facilitate the exchange of
information and build relationship bonds. Recently, (Formentini and Taticchi 2016)
documented that both governance mechanism [transactional governance (TG) and
relational governance (RG)] are important to control and implement sustainability
initiatives with a view to improving sustainability performance. Existing inter-firm
relationship literature suggests that, in order to achieve social performance, firms
need to enact contractual governance (Awan and Kraslawski 2017). Previous empirical studies demonstrated a significant positive link between contractual and formal
U. Awan et al.
2018b). Sustainability in corporate responsibility is being recognized as a doubleedged sword to spur sustainable development in the global world. It has also been
argued that sustainability might create better opportunities for future generations
by minimizing harms inflicted by the economic development of the natural system
(Bansal and Song 2017). The literature provides evidence supporting the idea that
corporate sustainability practices (CS) overlap with corporate responsibility (CR).
Corporate responsibility may include or exclude sustainability philosophy. Given the
importance of the social issues in literature, the most important dimensions related
to them include: workplace accidents (employee absenteeism), fair work practices
(number of new jobs created by the adoption of new technology) and community
development. Socially sustainable development is an important factor concerning
not only sustainable development but also the issues related to human development
in all facets of life and development of a socially sustainable system.
3 Literature Review and Hypothesis Formulation
The debate over the socially sustainable development issues has been inextricably
associated with the wide-ranging discussion about the type of governance suitable
for firms. Manufacturing firms face these challenges in both domestic and international arenas for growth that is as socially, and environmentally friendly as possible
and respective harnessing of opportunities offered by the governance mechanisms.
Governance mechanism ensures that firms can cope with social sustainability supply
chain issues (Gimenez et al. 2012). Previous research explored the relationship
between contractual and relational governance in governing business transactions and
reducing conflicts or opportunism (Jap and Anderson 2003; Poppo et al. 2008; Huang
et al. 2014); relationship effectiveness (Wagner 2011; Cao and Lumineau 2015) and
commitment (Sancha et al. 2016; Awan et al. 2018b). In relational governance (RG),
the inter-firm relationship is largely regulated by the division of tasks, social norms
and ties (Poppo et al. 2008; Zhou and Xu 2012). The contractual (transactional)
governance means governing transactions through contractual safeguards (Ferguson
et al. 2005). The governance context, in turn, is concerned with the characteristics
of specific knowledge and exchange of information with other supply chain partners
used to improve the firm’s performance. For instance, (Formentini and Taticchi 2016)
underscored the importance of linkages between the governance mechanism and
corporate sustainability approaches for the improvement of sustainability initiatives.
Athaide and Klink (2009) governance approaches facilitate the exchange of
information and build relationship bonds. Recently, (Formentini and Taticchi 2016)
documented that both governance mechanism [transactional governance (TG) and
relational governance (RG)] are important to control and implement sustainability
initiatives with a view to improving sustainability performance. Existing inter-firm
relationship literature suggests that, in order to achieve social performance, firms
need to enact contractual governance (Awan and Kraslawski 2017). Previous empirical studies demonstrated a significant positive link between contractual and formal