News
| 16.06.2025

Pandemics, ESG incidents, and financial crises disrupt the stability of supply chains 

Fraktfartyg fotat uppifrån, fyllt med containers.
The COVID-19 pandemic, the blockage of the Suez Canal in 2021, and the Russia-Ukraine war are examples of events that have disrupted supply chains. Media is increasingly mentioning how such events fragment the global supply chains, and now new research proves them right. 

In his doctoral dissertation, Jonas Gustafsson documents how different types of shocks affect global production networks and indeed escalate fragmentation.  

The production of goods and services is organised around complex supply chains, as firms rely on a variety of different inputs for producing output. As these production networks have been growing larger, the turbulence that they have experienced has also been increasing.  

Gustafsson finds that public-health policy uncertainty during the COVID-19 pandemic had an adverse effect on the extension of credit from suppliers in Europe. Major banking and currency crises also cause disturbances to supply chains around the world.  

Similarly, negative media coverage about a firm’s environmental, social, and governance (ESG) activities is found to increase the termination of global supply chains.   

“When a firm has a very high level of negative media attention to ESG related issues, such as violations of legislation or human rights abuses, then that firm’s supply chains are roughly 4 to 7% more likely to break in the next quarter,” Gustafsson notes.

Gustafsson found that the impact of different types of shocks depends on where a company is positioned in the supply chain.   

“For example, ESG-related issues tend to break supply chains more often when they happen closer to the end customer. If a company that sells directly to consumers faces negative media coverage and a consumer boycott, the likelihood of the supply chain falling apart increases by 31%,” Gustafsson explains.  

You can read the whole thesis here: Essays on supply-chain shocks and financing 

Jonas Gustafsson will defend his thesis on 19 June 2025 at 12.00, at Hanken School of Economics, Arkadiankatu 22, Helsinki.   

The doctoral defence will be held in hybrid form. Participants can attend on site or via video conference: https://go.hanken.fi/defence-gustafsson 

Opponent: Professor Shawn Thomas, University of Pittsburgh  
Custos: Professor Gonul Colak, University of Sussex Business School and Hanken School of Economics  

For further information:  
Jonas Gustafsson  
+358 40 683 4144  
Email: jonas.gustafsson@hanken.fi