Social sustainability in the oil and gas industry: institutional pressure and the management of sustainable supply chains

This article addresses certain gaps highlighted in the literature relating to the investigation of supplier selection through a theoretical lens, based on contextual factors, institutional pressure, and industrial features. Consequently, this article sheds light on how a government’s strategic plans can drive organisations to incorporate elements of social sustainability into their supply chains. A successful case from Oman which demonstrates the social dimension of sustainability in selecting suppliers in the oil and gas sector is presented, along with the government’s role and the mechanisms it has applied. A survey of purchasing, procurement and supply chain managers in Oman’s major oil and gas organisations was conducted, along with interviews. The results of this research were further analysed through the lens of institutional theory, addressing a genuine research gap. It was found that: (a) coercive governmental pressure is not sufficient to truly develop socially sustainable practices in organisations if the organisations themselves do not show initiative, as this leads to compliant rather than innovative practice; and (b) policy makers need to be aware that coercive pressure alone does not lead to continuous improvement of social sustainability performance, due to the ceiling effect, i.e. organisations meeting only the minimum governmental requirements.