Sustainable supply chain finance through digital platforms: a pathway to green entrepreneurship

Abstract

This paper studies the green new product development (GNPD) problem of a risk-averse capital constrained supply chain (SC). The SC is managed by an SME entrepreneur, seeking financial support from a multi-sided FinTech platform (MSP) to develop a portfolio of green and non-green products. The MSP offers the SC a combination of equity financing (EF) and debt financing (DF) facilities and must decide on the interest rate of its DF facility. Using a benchmark model, we first characterize the SC’s production and the MSP’s financing decisions under a deregulated scenario. Focusing on an alternative case with government intervention (i.e., hybrid environmental-green entrepreneurship policy), we next develop a three-level game theoretical model and sequentially characterize the decision-making behavior of government, MSP, and SC. The model outcomes are analyzed by considering the policy approach (i.e., economic influence vs. social welfare) and the platform’s risk attitude. The results reveal that, when coupled with an appropriate government intervention policy, a regulated scenario leads to a better outcome, particularly when the MSP is risk-neutral and strikes a right balance between the EF and DF. The win–win situation may not be realized when the MSP is risk-averse and the host government is merely focused on its economic influence. To successfully promote sustainable supply chain finance (SSCF) through digital platforms, policy makers are urged to leverage their legislative power and prioritize green entrepreneurship and social welfare over their financial maximization agenda.

Smart digital platforms for carbon neutral management and services: Business models based on ITU standards for green digital transformation

“…They also provide informational spaces as the material infrastructures for carbon accounting and carbon markets, as argued by an analysis of two Beijing-based enterprises working to decarbonize China. Business models are instrumental in advancing sustainable supply chain finance digital platforms (Reza-Gharehbagh et al, 2022a). Nonetheless, little research has been conducted on carbon neutrality platforms.…”

An exploratory review of the fintech influence field

“…The development of digital finance has been shown to influence the quantitative and qualitative indicators of green innovation of companies for several years. Reza-Gharehbagh et al (2022) modelled new scenarios for the financing of new green-product development chains to balance corporate risk aversion and government support for green initiatives. Chen et al (2022a) examined the impact of government green initiatives on polluting and less polluting companies and evaluated the role played by fintech and company ownership.…”

Digitalization and artificial knowledge for accountability in SCM: a systematic literature review

“…The analysis provided a brief profile of each article in terms of its aims, findings, methodologies, and underpinning theories. Scholars have examined the use of digitalization and artificial knowledge in SCM in various industries, such as food and agriculture, ICT, fashion, logistics, marine, textile, tourism, healthcare, fishing, automotive, pharmaceutical, construction, minerals, mining, and manufacturing (Bechtsis et al, 2017;Cherviakova and Cherviakova, 2018;Garcia-Muiña et al, 2018;Pongpanit and Sornsaruht, 2019;Alharthi et al, 2020;Calvão and Archer, 2021;Chen et al, 2022;Griffin et al, 2022;Joshi and Sharma, 2022;Mahroof et al, 2022;Mishra et al, 2022;Oguntegbe et al, 2022;Shamout et al, 2022;Sharma et al, 2022;Shi et al, 2022), and across multiple levels including SMEs, cities, individuals, the government, and the world (Babenko et al, 2020;Bellingan et al, 2020;Wong et al, 2020;Bagloee et al, 2021;Bisogni et al, 2021;Hjaltad ottir and Hild, 2021;Potocka-Sionek, 2021;Nasir et al, 2022;Nudurupati et al, 2022;Reza-Gharehbagh et al, 2022a).…”