The effect of supply chain risks on organizational performance: the role of green supply chain management practices and buyer-supplier relationship.

Malaysian manufacturing sector remains the second-largest sector that contributes to the Malaysia Gross Domestic Product (GDP). However, this sector still faces a few challenges pertaining to economic and environmental perspectives. Taking note of these issues, this study investigates the relationship between supply chain risks, green supply chain management (GSCM) practices, buyer-supplier relationship, and organisational performance among ISO 14001-certified manufacturing sector in Malaysia. Specifically, this study examines the mediating effect of GSCM practices as a role of strategy and the moderating role of the buyer-supplier relationship. Resource-based view (RBV) theory, natural-resource-based view (NRBV) theory, and relational-view theory are integrated to enlighten the probable relationship between the variables to develop a research framework. A total of 125 companies representing the ISO 14001-certified manufacturing companies in Malaysia participated in this study. The data was collected via the survey method. Partial Least Squares (PLS) procedure was applied to analyse the data and test the hypotheses of this study. Statistical results found that supply risk, demand risk, and environmental risk have significantly and negatively affected organisational performance. Nevertheless, there are only two types of supply chain risks that were found to be insignificant, which are manufacturing risk and information risk. GSCM practices mediate the relationship of supply risk, information risk, and environmental risk towards organisational performance. However, no moderation effect of the buyer-supplier relationship was found on the relationship between GSCM practices and organisational performance. This study contributes to the body of knowledge and practical by providing a strong research framework for a clear understanding that describes the mediation effect of GSCM practices as a role of strategy on supply chain risks and organisational performance without taking into account the role of buyer-supplier relationship that would be utilised by the companies and the academicians.