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Put your suppliers under the microscope: The importance of supply chain transparency

Liz Minshall
Nov 30, 2016

Since the Modern Slavery Act came into force in October 2015, there has been significant press surrounding issues such as child labour, exploitation of factory workers and poor working conditions. Although these issues have been reported on for a long time, this recent media frenzy has highlighted the importance for businesses to try and gain full visibility of their supply chains’ individual business practices, as association alone has gone some way to shine a negative light on some of the most reputable organisations and well-known brands.

This isn’t the first time that companies (including well-known brands) have been tarnished by the actions of their suppliers. You only have to look back three years to the Horse Meat Scandal of 2013, whereby lack of supply chain transparency meant that horse or pork meat ended up being used in food stuffs that were supposed to contain beef.

Some of the difficulties businesses face

It is evident that it can be extremely difficult for businesses to keep tabs on all suppliers, especially if the suppliers are being dishonest and paying lip service to top down demands for fair practice.

Also, some businesses may not have a direct relationship with all suppliers, making them hard to reach, keep tabs on and obtain data from.

And more often, businesses have suppliers that are based in far flung countries where labour laws may contrast those established in the UK and in some cases may not exist. This often means that the definitions of modern slavery in these countries differ to UK law.

The barrier of cultural norms

One of the biggest barriers that businesses face are cultural norms.

For example, I recently read about a retailer who is working with a supplier, in East Asia, that has a factory in a location where employees live in nearby accommodation. Workers stay in the accommodation for a season, away from their homes, with the aim of making as much money as possible so that they are able to make the most of their time and bring a bigger sum of money back to their families. When the employer tried to impose a maximum number of working hours a day they were met with resistance, as the workers wanted to, and were prepared to, do as many hours as possible. For UK retailers that use this particular supplier (or suppliers in the same position), which might not necessarily be a direct supplier, it becomes a bit more difficult to regulate.

How Valpak can help

We have developed a web-based data portal, called TRACE, which helps businesses to increase transparency of upstream and downstream operations.

TRACE helps customers to create risk management processes, identify where any risks to the business may be, and recognise target areas for action.

Seminar - Transparency in Your Supply Chain Seminar

We are hosting a free seminar, on 19 April 2017, which will provide delegates with an introduction to the UK Modern Slavery Act in the broader suite of ethical trade trends. Places can be booked here.

For further information about our TRACE system please call 03450 682 572 or email env.compliance@valpak.co.uk

Disclaimer: The opinions expressed in this weblog represent those of the individual authors and not those of Valpak Limited or any other organisation.