In English

Strengthening driving forces and overcoming barriers of utilizing ethical values in subcontractor and customer relationships

Rita Berggren ; Hanna Ålgårdh
Göteborg : Chalmers tekniska högskola, 2013. 99 s. Master thesis. E - Department of Technology Management and Economics, Chalmers University of Technology, Göteborg, Sweden; E2013:121, 2013.
[Examensarbete på avancerad nivå]

The construction industry faces a challenge in tackling the unethical practices in the business. These practices are for example; bribery, illicit work, nepotism, discrimination and fraud. For Sweden’s major contracting companies, 75 percent of their revenue is spent on their suppliers in terms of material and services. Over time, the spend on subcontracting has significantly increased within the Swedish construction industry. The context of the construction industry is characterized by three aspects; one-off nature of projects, temporary multiorganizations and short term relationships. Due to these characteristics and the large degree of subcontracting, complex supply chains are created and the construction companies face a challenge to keep control of all tiers involved in a project. Since unethical actions in a supply chain are not necessarily confined to the company performing them, the impact can spread to other actors in the chain. Ethical misconduct can be seen as one of the risks with largest negative impact on a company due to the losses it may bring; reduced profitability, lost trust in the brand and deteriorated work environment for the employees. Therefore, it is vital for companies to reduce the risk of misconduct by ensuring that the supply chain acts ethically. This study has been conducted at Skanska Sweden within the purchasing department and the project organization. Skanska’s corporate goal is to have zero ethical breaches and the vision is to become a leader in ethics by 2015. With this and the paragraph above in mind, the following purpose has been developed for this study: “The purpose is to investigate driving forces and barriers for ethical work in the construction industry from a business perspective and to provide recommendations for strengthening and overcoming them respectively.” In order for Skanska to avoid the potential risk scenarios stemming from ethical misconduct in the supply chain, the employees need to utilize the company’s ethical values towards subcontractors. Simultaneously, in order to differentiate and create business opportunities based on the ethical values, Skanska should utilize these values towards customers. The company´s ethical values stem from the code of conduct and consider for example; no discrimination or harassment, no fraud, no bribery and no illicit work. The term utilize will in this study concern communication, marketing, using ethics as a subcontractor requirement and using ethics as a differentiator on the market towards customers. The recommendations are; first, to motivate each role within the company to utilize ethical values towards subcontractors and this through incorporating the ethical values in daily work. In turn, the improved supply chain with regards to ethics can result in a protected and strengthened brand. Second recommendation is to overcome employees’ inadequate knowledge concerning utilization of the ethical values and this through developing guidelines for responsibility and how to communicate with subcontractors as well as discussion material for subcontractor relationships. Third recommendation is to create awareness of ethics as a supplier selection criterion by communicating ethical values towards customers and developing guidelines and discussion material for customer relations. The third recommendation also includes that Skanska should focus on differentiating with the ethical values towards customers with shared values through prioritizing among the customers. The key effects for Skanska if implementing the three recommendations are; avoidance of ethical misconduct in the supply chain, protection and improvement of Skanska’s brand, profitability and staff’s health, as well as development of ethical values as a differentiator on the market.

Nyckelord: Ethics, Supply chain management, Construction industry, Risk

Publikationen registrerades 2014-02-28.

CPL ID: 194293

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