Value Chain Responsibility: A Farewell to Arm's Length

This paper discusses the evolving conception of responsibility within value chains (i.e., value-chain responsibility, or VCR) from the perspective of stakeholder research. Following a brief discussion of stakeholder theory and a review of the related literature on supply chain ethics, the paper examines the recent managerial challenges to claims of arm's length transaction. It discusses the practical realities of this evolution and provides guidance for managers of firms operating under these new responsibilities. More work is needed when firms with minimal public profile find themselves called upon to provide greater VCR. Even if a company is not the direct target of more or legal critiques, all it takes is to have one questionable firm in the company's value chain to draw this unwanted attention. This is the promise and the peril of life in a networked economy.