Advancing green supply chains through downstream digitalization: An information processing theory perspective

Abstract

Environmental sustainability has become a critical priority in supply chain management, driven by evolving customer expectations and regulatory pressures. While digitalization's role in improving operational efficiency is well-established, its specific impacts on environmental performance through downstream supply chain processes remain underexplored. Drawing on Information Processing Theory (IPT), this study investigates how downstream supply chain digitalization (DSCD) enhances information processing capabilities, enabling firms to effectively implement distinct green supply chain management (GSCM) practices—internal environmental management, eco-design, green purchasing, and investment recovery. Using structural equation modeling on data collected from 373 manufacturing firms in Portugal, our findings demonstrate that internal and external GSCM practices mediate the relationship between DSCD and EP. Specifically, internal environmental management systems are foundational in facilitating external GSCM practices, thus amplifying DSCD's impact on EP. This research contributes to the supply chain management literature by highlighting how downstream digitalization enables firms to address customer-centric sustainability challenges and by emphasizing the essential role of internal structures in supporting environmental goals. Practically, the study guides supply chain managers in aligning downstream digitalization investments strategically with targeted sustainability initiatives to enhance environmental outcomes.