Environmental upgrading in global value chains

Abstract

Responding to stakeholder pressure, firms are increasingly challenged to reduce their environmental impacts. This chapter reviews the potential upgrading trajectories for firms engaged in global value chains (GVCs) to effectively reduce the impacts on the environment of all activities linked to their products - not just those that are carried out in house - and the major drivers of these investments. We also examine the role of global lead firms in fostering the greening of GVCs and the different governing approaches that they have adopted. Furthermore, we look at different forms of supplier agency in these processes, both in the Global North and the Global South. Finally, we identify the key challenges related to the reduction of environmental impacts along GVCs and discuss limits and opportunities for the joint achievement of economic and environmental outcomes.