Socially Responsible Supply Chain Management in Context of ESG
Professor Xiao Yongbo, Tsinghua University
Date: December 13, 2023 (Wednesday)
Time: 15:30 am -16:30 am
Venue: A302, Mingli Building, Lihu Campus, Shenzhen University
Host: Professor Ma Lijun, College of Management, Shenzhen University
Abstract
With the wide advocacy of ESG (environment, social, and governance), it has been increasingly prevalent for firms to consider social responsibilities in their daily decisions. The increasing demand of ESG induces firms to make a trade-off between traditional objectives (e.g., revenue and profit) and ESG objectives, such as environmental impact, consumer/social welfare, and common prosperity. In this paper, we consider a socially responsible firm that concerns its profit as well as consumer welfare. In particular, the firm seeks to optimize a mixed objective, which is a weighted sum of its profit and consumer surplus. Motivated by practices, we consider the firm's donation as a mean to boost consumer surplus. The donation quantity may impact socially responsible customers' willingness to purchase. We study the firm's optimal joint decisions on selling price and donation quantity, for the scenario in which the firm makes prioritized donations to the high-value and empty-handed customers so as to improve the overall consumer surplus. The optimal decisions are compared to the benchmark model where no donation is made by the firm. Furthermore, we examine three model extensions, in which the firm can only donate randomly to the empty-handed customers, the firm has an exogenous batch of initial inventory, and the so-called ``warm glow effect" is also included in the firm's objective function, respectively. Our study uncovers some interesting managerial insights for socially responsible firms in balancing its profit with customer welfare in the presence of prosocial customers.
Speaker's Biography
Professor Xiao Yongbo is a permanent professor in the Department of Management Science and Engineering at the School of Economics and Management, Tsinghua University. He obtained a bachelor's degree in Management Information Systems from Tsinghua University in 2000, a master's and doctoral degree in Management Science and Engineering from Tsinghua University in 2006, and a postdoctoral fellow in Applied Economics from the School of Economics and Management at Tsinghua University from 2006 to 2008.
He served as the deputy editor in chief of the international academic journalNaval Research Logistics and the executive editor of Journal of Systems Science and Systems Engineering; Also he served as an editorial board member for domestic journals such asChinese Management Science,Systems Engineering Theory and Practice, andJournal of Systems Management.
He achieved the Outstanding Youth Fund of the National Natural Science Foundation of China, the Excellent Youth Fund of the National Natural Science Foundation of China (2012), the Famous Scholar and Young Scholar of the Ministry of Education, the China Management Youth Award, and the Third Prize of the Beijing Science and Technology Award. His research paper was selected as one of the top academic papers in the 2021 F5000 Chinese Fine Science and Technology Journal, and the suggestion report was adopted by the National Committee of the Chinese People's Political Consultative Conference, Beijing Municipal Committee of the Chinese People's Political Consultative Conference, and Xinhua News Agency.
His main research areas include revenue and pricing management, operations and supply chain management, and he has led multiple National Natural Science Foundation projects (including youth, general, key, and major projects). His academic papers have been published in international academic journals such asOperations Research, Production and Operations Management, IIE Transactions, Decision Sciences, Naval Research Logistics, and Systems Engineering Theory and Practice. In domestic academic journals such asChina Management Science and Journal of Management Science.
