Towards an understanding of illegal supply chain design in conflict areas: the case of the grain supply chain in Ukraine

Purpose: The purpose of this research is to shed light on illegal supply chains (ISCs) and the factors (enablers) behind their emergence using data on grain supply chain in Ukraine. Design/Methodology: A two-step methodology was adopted. First, documentary sources (including press articles, published papers, reports, and grey literature) on grain ISCs in Ukraine were analysed using the Fraud Diamond theory with the aim of identifying the main underlying issues. Second, interviews with experts were conducted to elaborate on the propositions regarding ISC design and enablers. Findings: The findings revealed the existence of two ISCs in Ukraine: the fraudulent grain and looted-grain supply chains (SCs). We propose an integrative ISC framework based on a combination of Fraud Diamond theory components (pressure, opportunity, rationalisation, and capability) and SC network design elements (formalisation, centralisation, complexity, and density). We suggest that ISCs in conflict regions emerge owing to geopolitical instability and lack of logistics optimisation and provide several propositions for further research. Research Limitations/Implications: This research contributes to the literature on ISCs by offering nuanced understanding of their design and enablers. It underscores the impact of geopolitical disruptions on ISC operations and highlights how factors such as logistical inefficiencies, bottlenecks, and infrastructural weaknesses facilitate the activities of these illicit networks. This study provides valuable insights beyond the context of the Russia-Ukraine conflict, offering broader applicability to other scenarios, where disruptions - whether geopolitical, economic, or environmental – expose SC vulnerabilities. Practical Implications: The results of this study can be informative for government authorities and policymakers in formulating measures aimed at addressing illegality in SCs. Originality/Value: This study is the first to investigate ISCs in conflict areas by analysing the case of the grain SC in Ukraine. This study provides a solid foundation for future research on ISCs with similar characteristics.