Governance & Policy
Relational Value Chain
Definition
A relational value chain is one of five governance types in global value chain theory (Gereffi, Humphrey and Sturgeon), characterised by complex transactions and high supplier capabilities, where coordination relies on dense information exchange, mutual dependence and reputation rather than price signals or direct ownership. Relationships are built over time and switching costs are high for both parties.
References
Supports definition and framing.
Overview
How it is used
The concept is used in value chain research, ethical trade programme design (long-term supplier relationships), and analysis of how lead firms drive or block supplier upgrading.
Why it matters
Understanding chain governance explains why identical sustainability policies succeed in some supply chains and fail in others — relational chains reward partnership over policing.