Saturday, 21 January 2017

The Knowledge: Companies urged to interrogate supply chains

Ethical supply chain issues are a real threat to the reputation of a brand

Factory collapses, sweatshops, child labour and supermarket bullying are just some of the ethical supply chain issues that have damaged brands and reputations in recent years. 

In February, UK groceries code adjudicator Christine Tacon launched an investigation into Tesco’s treatment of suppliers over suspicion that it had breached the groceries supply code of practice. 

Stay informed. The latest news direct to your inbox.

It comes as the Federation of Small Businesses (FSB) revealed that one in five small firms had suffered “supply chain bullying”. 

The FSB said the results indicated a serious deterioration of payment practices, including late payments and ‘pay to stay’ (also known as ‘supplier assessment charges’).

“Small businesses are fast approaching breaking point,” FSB national chairman John Allan said. 

“They are no longer prepared to put up with these sharp practices. Brands that think they can continue to squeeze their suppliers with impunity may get a nasty shock when what they are doing comes to the attention of their consumers.”

Operating ethically and profitability are no longer mutually exclusive concepts, consultancy Accenture said. 

“Social media is enabling customers to gain greater transparency, faster. A company that looks away as factory workers are exploited by a sub-supplier will feel the ire of their customer base,” it warned. 

Ethical supply chains

Have your say

Please add your comment. Remember that submission of comments is governed by our Terms and Conditions. You can include links, but HTML is not permitted.

Mandatory
Mandatory
Mandatory
Mandatory
Insurance Times
Be part of the conversation
Sign up for Insurance Times Email Bulletins Join Us on Twitter Join Us on LinkedIn Subscribe to our YouTube page Join Google Plus



Meet the Team | Insurance Times