UK businesses should pay greater attention to the ethical issues that arise in dealing with their domestic suppliers, the Institute of Business Ethics said in a report published on September 22. Attention has previously been focused on the social, environmental and ethical concerns of the relationships with suppliers in developing countries. But following the tragedy of the Morecambe Bay cockle-pickers, companies are more aware of the need to ensure that their suppliers based in the UK are also fairly treated.
Supplier Relationships in the UK: Business ethics and procurement practice highlights two sets of challenges – those around responsible practices by purchasing staff and fair business relationships with suppliers; and those around the notion that large companies have responsibility for their own social and environmental impacts as well as what happens in the firms in their supply chain.
The report argues that SMEs, which make up the vast majority of the private sector, are consistently disadvantaged and it also includes best practice examples from Camelot, Waitrose and Toyota.
Contact; Philippa Foster Back 020 7798 6040 www.ibe.org.uk
Tesco investigates child labour claims
Tesco said that it has found no evidence that one of its Bangladesh-based suppliers employed children as young as 12 to produce its Florence and Fred clothing bands, but is continuing to investigate the case.
In an undercover investigation, Channel 4 featured footage of children who were allegedly under 15 years old, working at four factories that supply the UK’s largest supermarket group.
In one interview, a 12-year-old who claimed to work as a machinist at one of Tesco’s suppliers, Harvest Rich, said: “They (the factory) did ask me about my age. I said I was 11 years old. And they took me in.” He also claims that “around 200-300 child workers” are employed by Harvest Rich. In another interview a 12-year-old girl, who claims to work for Harvest Rich said she earns £9 a month.
Tesco told Briefing that it “abhors the use of child labour” and that it has carried out unannounced visits to Harvest Rich as well as other suppliers in Bangladesh, accompanied by independent auditors.
To date, Tesco has not found any evidence of child labour. Tesco is now working with NGOs to establish whether the supplier in fact employed the children shown in the film and whether they were truly underage.
Channel 4 News added that there was no evidence that the supermarket knew about the child labour at any of the factories.
Wal-Mart announced that in 2005, 141 factories were permanently banned from doing business with the company, primarily because of underage labour violations.
In its 2005 Report on Ethical Sourcing, the retail chain said it carried out 13,600 audits of 7,200 factories last year. Compared to 2004, Wal-Mart said it saw an increase of high-risk violations to 52.3% from 35.6%, due to a 100% increase in unannounced audits and the increased rigour of its supplier standards. In addition, Wal-Mart implemented team audits in 2005, reclassified violations to strengthen and reinforce their severity and auditors became more familiar with the factories and their workers.
The City of London Corporation is encouraging City-based companies to source goods and services from local suppliers as a way to help regenerate some of the more deprived neighbouring boroughs, such as Tower Hamlets, Hackney, Islington, Camden, Lambeth, Southwark and Newham.
“Having introduced policies to help increase the involvement of local businesses in the provision of services and contracts to the City of London Corporation, we are now spreading the word and encouraging City firms to review their current procurement policies and helping them to establish local procurement strategies by sharing information on our own work in this area,” said Michael Snyder, chairman of Policy & Resources at the City of London Corporation.
“If local sourcing captures a small percentage of the purchasing power of the City, we could drive huge economic benefit to these boroughs over the next five to ten years.”
The City of London Corporation is holding meetings with big City firms to raise awareness of the issue, map current practices, and assess possible resource changes (including improving trade with small and medium sized businesses and black and minority ethnic businesses). These meetings are enabling the City of London to capture information on the procurement habits of the City in a variety of different sectors, to look at current and emerging trends and factors influencing corporate procurement.
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