ANALYZING THE EFFECT OF SUSTAINABLE SOURCING ON SUPPLY CHAIN PERFORMANCE BY TRIPLE BOTTOM LINE CONCEPT IN THE TOBACCO INDUSTRY : A CASE STUDY OF JAVA TOBACCO COMPANIES

• Main Author: Celtica Samudra, Ravshan
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/77737
• Institution: Institut Teknologi Bandung

Tobacco Industry is a highly controversial sector since it is under criticism for its negative health problem. Therefore, stakeholders have continually increased its pressure on Tobacco Industry for adopting sustainable sourcing on its Supply Chain Management to address their implication towards the environment, social and economic dimension. However, implementing sustainable sourcing may create trade-offs that could potentially hinder supply chain performance. This research aims to investigate the correlation between Sustainable Sourcing and Supply Chain Performance in the Tobacco Industry by evaluating the industry Environment Practice, Social Responsibility, Economic Practice as well as finding out the impact of this relationship. The methodology for this research is by online survey to 115 professionals in the Tobacco Industry and have been involved in planning, verifying, and implementing sustainable sourcing practices in their companies. The data collection then examined using Descriptive Statistic and PLS SEM models. The study findings indicate that the tobacco industry's environmental, social responsibility, and economic practices are significantly influenced by sustainable sourcing. This implies that companies that prioritize sustainability in their sourcing strategies are more likely to adopt eco-friendly practices, encourage social responsibility, and boost their financial performance. Therefore, companies that implement sustainable sourcing can improve their supply efficiency, product quality, brand image, and customer satisfaction. However, the research discovered that social responsibility has no significant influence on supply chain performance. The Tobacco Industry should focus more on improving its environmental and economic practices to enhance its supply chain performance. On conducting the research, the following limitation is established: 1) The research population and sample are specifically limited to Indonesia 2) This research employs a quantitative approach, utilizing descriptive analysis and Partial Least Square (PLS-SEM) analysis methods As there are limited studies exploring the relationship between these variables, this research aims to fill the gap in the literature. Moreover, this research provides management-level recommendations on implementing sustainable sourcing practices to achieve a high-performing supply chain.