Facing various regulatory and community pressures, pharmaceutical companies have viewed corporate social responsibility (CSR) as a strategic issue (Chaabane, Ramudhin, and Paquet 2011; Gimenez and Tachizawa 2012; Smith 2008). Researchers argue that CSR in pharmaceutical industry is more than philanthropic activities (Leisinger 2005; Salton and Jones 2015) and multinational pharmaceutical companies have not been living up to their social responsibilities (Leisinger 2005; Rossetti, Handfield, and Dooley 2011). As pharmaceutical companies are boosting their efforts to source products and services from emerging economies and are working in partnerships with suppliers (Gupta, Pawar, and Smart 2007; Smith 2008; Zhang et al. 2013), cases involving suppliers who operate irresponsibly have been widely reported and have centred on environmental and social issues (Schneider, Wilson, and Rosenbeck 2010; Smith 2008). Hence, suppliers’ capabilities and skills to deal with CSR challenges play critical roles in pharmaceutical companies’ CSR performance (Foerstl et al. 2010; Schneider, Wilson, and Rosenbeck 2010). However, there is limited empirical evidence on how to improve suppliers’ CSR capabilities in the pharmaceutical industry (Frederiksborg and Fort 2014; Smith 2008). Supplier development has been viewed as an important supply chain management method for a company to identify and select an adequate pool of suppliers to provide products and services needed by the company, and to improve their capabilities to meet the company’s short- and/or long-term requirements (Krause and Ellram 1997; Krause, Handfield, and Scannell 1998). Studies have documented the benefits of supplier development on knowledge transfer and supply chain performance, including new product development, cost, quality and delivery (Krause, Handfield, and Tyler 2007; Modi and Mabert 2007; Rogers et al. 2007; Sanchez-Rodriguez, Hemsworth, and Martinez-Lorente 2005). Pharmaceutical companies are devoting more and more resources to supplier development programmes (Foerstl et al. 2010; Genovese et al. 2014). Such efforts enable companies to transfer knowledge and skills to suppliers and enhance their CSR and other performances (Ayuso, Roca, and Colome 2013; Humphreys et al. 2011). Supplier development activities can be motivated by institutional pressures or suppliers’ capability gaps (Rogers et al. 2007). In particular, the institutional theory argues that coercive, mimetic and normative pressures affect companies’ strategic decisions (DiMaggio and Powell 1983). Pharmaceutical companies develop codes of conduct and principles to manage supplier’s activities to fulfil the requirements and expectations of external stakeholders, such as government agencies, collective industrial associations, regulators, non-government organisations (NGOs) and consumer groups, on supply chain’s environmental (e.g. waste, material recycling, pollution and product design) and social impacts (e.g. safety and health) (Linton, Klassen, and Jayaraman 2007). The resource-based view suggests that companies can use supply chain partner’s resources, such as physical, human, intellectual and financial resources, to develop skills and capabilities (Barney 1991).