Supplier Co-prosperity in the ESG Era: The Impact of Regulatory Coercion and Competitive Intensity on Firm Outcomes

This study investigates how coercive regulation and competitive intensity, as dual external pressures, influence supplier co-prosperity activities and ultimately firm performance in supply chains. Drawing on institutional theory and supply chain management perspectives, the research reconceptualizes supplier co-prosperity as a critical expression of the ESG social pillar. Partial least squares structural equation modeling is employed to test hypothesized relationships and mediation effects using survey data from Korean firms. Findings reveal that coercive pressure significantly enhances supplier co-prosperity and positively affects firm performance fully mediated by supplier collaboration. Competitive intensity also promotes supplier co-prosperity but only marginally influences performance indirectly. The results emphasize the pivotal role of supplier-oriented ESG practices in bridging institutional demands and market dynamics to create sustainablecompetitive advantages. This study contributes to ESG and supply chain literature by highlighting supplier co-prosperity as both a legitimacy-seeking and strategic mechanism, offering valuable implications for managers and policymakers navigating evolving ESG governance.