Document Type
Article
Publication Date
2025
DOI
10.1111/eufm.70040
Publication Title
European Financial Management
Volume
Advance online publication
Pages
24 pp.
Abstract
We examine the role of major customers in shaping firms' environmental, social and governance (ESG) practices. We find that firms with major customer relationships undertake fewer ESG activities compared to those without such ties. The association is attenuated when institutional ownership is high, firms are less diversified, customers exhibit greater bankruptcy risk and lower switching costs and during periods of elevated equity market sentiment. Taken together, our findings highlight that reliance on a concentrated customer base can weaken firms’ incentives to engage in ESG practices, with important implications for supply chain sustainability.
Rights
© 2025 The Authors.
This is an open access article under the terms of the Creative Commons Attribution 4.0 International (CC BY 4.0) License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.
Original Publication Citation
Dong, F., Doukas, J. A., Walton, S., Zhang, R. G., & Zhang, Y. (2025). Do major customers affect firms' environmental, social and governance activities? European Financial Management. Advance online publication. https://doi.org/10.1111/eufm.70040
Repository Citation
Dong, Feng; Doukas, John A.; Walton, Stephanie; Zhang, Rongyao Gloria; and Zhang, Yiyang, "Do Major Customers Affect Firms' Environmental, Social and Governance Activities?" (2025). Finance Faculty Publications. 58.
https://digitalcommons.odu.edu/finance_facpubs/58
Included in
Business Law, Public Responsibility, and Ethics Commons, Finance Commons, Operations and Supply Chain Management Commons, Organizational Behavior and Theory Commons
Comments
Data availability statement: Article states: "The data that support the findings of this study are available from the corresponding author upon reasonable request."