Value-Driven Supply Chains: Does The Tscherning Case Redefine Risk?
In May 2025, Denmark’s construction giant Tscherning sent a clear message through the business world by returning its entire fleet of Tesla vehicles, not for technical or financial reasons, but to sever ties with the political direction embodied by Tesla CEO Elon Musk. The company’s leadership declared, “At Tscherning, we not only decide how we drive, but also who we drive with,” underscoring a new era where values, not just value, drive supply chain decisions.
This bold move mirrored an August 2024 announcement by German retail company Rossmann, which halted all new Tesla purchases for its corporate fleet. Rossmann’s CEO cited the incompatibility between Musk’s open support for Donald Trump, who has dismissed climate change as a “hoax,” and Tesla’s stated mission of environmental stewardship. For Rossmann, aligning its procurement with its social and ecological values outweighed the convenience or prestige of the Tesla brand.
These are not isolated incidents. They might be the opening chords of a new symphony in global supply chain management, a shift from cost-driven pragmatism to value-driven strategy.
Reputation: The New Supply Chain Vulnerability
For decades, supply chain professionals focused on cost, quality, delivery, and compliance. Today, reputational risk, especially the risk of value misalignment, has emerged as a critical vulnerability. The Tscherning and Rossmann cases illustrate how a supplier’s public stance or leadership can provoke customer backlash, erode trust, and trigger rapid disassociation, even if the products themselves remain best-in-class.
In this climate, traditional due diligence is no longer enough. Procurement leaders must now conduct ongoing assessments of suppliers’ public profiles, leadership behaviors, and ideological alignments. The stakes are high: a single misstep can ignite social media firestorms, alienate stakeholders, and inflict long-term brand damage.
The Business Case for Values Alignment
Why would companies incur the cost and disruption of switching suppliers or returning entire fleets? The answer lies in the rising prominence of environmental, social, and governance (ESG) criteria and the demand for authentic values alignment. When a supplier’s values clash with those of the buying organization, the risk is not only reputational; it can undermine stakeholder trust, employee morale, and even market share.
Aligning with like-minded suppliers fosters trust, transparency, and innovation, while reducing the risk of public controversies or regulatory headaches. Ignoring value alignment exposes organizations to unpredictable shocks, as reputational fallout can be swift and difficult to contain.
The Political Dimension: Partisan Supply Chains
The Tscherning and Rossmann cases may reflect a broader trend: the politicization of global supply chains. Research confirms that companies are adjusting their sourcing strategies based on political and ideological alignment, rather than just cost or efficiency, a phenomenon known as “partisan supply chains.” Firms led by CEOs with strong political leanings are more likely to cut ties with suppliers in ideologically distant spheres, even at significant cost to firm value.
Political instability, regulatory changes, and trade barriers further amplify supply chain risks, as seen in recent years with Brexit, the US-China trade war, and sanctions on Russia. In this volatile landscape, supply chain leaders must be more agile than ever, building resilience through diversification, scenario planning, and continuous monitoring.
Lessons for Supply Chain Leaders
The new reality demands a shift in mindset. Risk management must now encompass reputational and political dimensions alongside operational and financial factors. This requires:
• Ongoing supplier due diligence that includes values and public stances, not just technical or financial criteria.
• Transparent communication with suppliers about expectations for values alignment and ethical conduct.
• Scenario planning that considers the impact of political controversies or ideological shifts on supplier relationships.
• Decisive action, even at significant cost, when value misalignment threatens the company’s reputation or stakeholder trust.
The future belongs to those who combine technological sophistication with ecosystem thinking and ethical clarity. Supply chains are no longer invisible infrastructure; they are the public face of corporate values, subject to intense scrutiny and rapid shifts in public sentiment.
From Cost-Driven to Value-Driven Chains
The Tscherning and Rossmann stories are emblematic of a profound transformation. As ESG and stakeholder capitalism take root, supply chains are moving from being purely cost-driven to value-driven. The choices of suppliers, partners, and even the public personas of their leaders are now inseparable from the company’s brand and reputation.
This shift brings both complexity and opportunity. Supplier selection and risk management are more challenging, but companies willing to lead with their values can forge deeper, more collaborative partnerships rooted in shared purpose and mutual respect. In this new era, the question is no longer just what your suppliers can do, but who they are, what they stand for, and whether those answers align with your vision for the future.