Role of generative AI towards sustainable procurement

Abstract

Purpose This study examines the impact of Generative Artificial Intelligence (GAI) on sustainable procurement, highlighting its potential to improve operational efficiencies, ensure compliance with sustainability standards and mitigate risks associated with complex supply chains. Design/methodology/approach The study employs a quantitative design, informed by exploratory interviews. We used structural equation modelling to investigate the roles of GAI in dynamic pricing, behavioural nudging, life cycle assessment, carbon footprint tracking and compliance checking. Findings The study offers theoretical contributions viewing sustainable procurement as a strategic resource and how digital tools like GAI can help extending resource-based view (RBV) in developing unique capabilities in carbon tracking, low-carbon sourcing and compliance. Adopting RBV, organizations can develop adaptive procurement system and position procurement as a core drive of sustainable competitive advantage. Practically, organizations can leverage GAI to navigate the challenges of modern supply chains more effectively, promoting sustainability while maintaining competitive advantage. This study highlights the pivotal role of GAI in advancing sustainable procurement practices and its importance in the broader discourse on sustainability and technological innovation in supply chains. Originality/value The integration of GAI into sustainable procurement practices presents a transformative opportunity for organizations to align their supply chain processes with their sustainability goals. Our findings suggest that practice managers can make use of GAI to achieve sustainable procurement by enabling data-driven decision-making, promoting transparency among supplier networks and facilitating stakeholder engagement. Our study contributes to extending the existing debate of how generative AI can influence sustainable procurement.

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