Tag Archives: Modern Slavery

Spot the Signs: 9 Ways To Identify Modern Slavery

Contrary to popular belief, the victims of modern slavery are not always hidden away in secret locations. After a 126% increase in reported slavery, Crimestoppers UK has partnered with a labour abuse authority to help the public – and supply management professionals – recognise slavery taking place in their own backyard.  

As procurement professionals worldwide move to stamp out modern slavery in their supply chains, the enormity of the challenge needs to be met with every available tool. Compliance with legislation, accreditation programs, policies and procedures are all very necessary, but so, too, is simply keeping your eyes and ears open when visiting suppliers on-site.

Crimestoppers and the GLAA (Gangmasters and Labour Abuse Authority) have released nine common signs that victims of modern day slavery share. These signs are intended to raise public awareness and encourage people to report their suspicions, but many are relevant for supply managers, too. Keep an eye out for these signs when visiting your first-tier suppliers, and encourage your suppliers to do the same with their suppliers, and so on.

Nine Signs to Spot

Victims of modern slavery may:

  1. Show signs of injury, abuse and malnourishment
  2. Look unkempt, often in the same clothing and have poor hygiene
  3. Be under the control and influence of others
  4. May have inappropriate clothing for the work they are performing, and/or a lack of safety equipment
  5. Be collected very early and/or returned late at night on a regular basis
  6. May be isolated from the local community and their family
  7. Live in cramped, dirty, overcrowded accommodation
  8. Have no access or control of their passport or identity documents
  9. Appear scared, avoid eye contact, seem untrusting

Crimestoppers’ statistics in the UK alone show a 126% increase in information received on slavery in the past six months compared to the previous six-month period. It is this general rise in slavery figures nationwide which reflects why the GLAA has recently been granted a broader remit and stronger powers to tackle labour exploitation across the economy, introducing the capacity to search and seize evidence and investigate modern slavery where it relates to labour abuse and other offences.

Emily Van der Lely, Crimestoppers Lead on Slavery, said: “It’s so awful to hear that slavery is even an issue in this day and age, but we want to reassure victims that it is an issue that is taken extremely seriously, and make it clear to perpetrators that they will be found and prosecuted.

“By launching this campaign, we will educate the public as to the signs to spot and let them know that they can take action on this horrendous crime, without compromising their anonymity.”

Paul Broadbent, Chief Executive of the GLAA, said: “The public need to understand and be aware that modern slavery is happening right now, in and around the communities they live. Exploiting someone for their labour, forcing them to work, using people as commodities – these practices are abhorrent and we need the public’s help to stamp it out..”

Common industries for modern slavery:

  • Transport
  • Warehousing
  • Agriculture
  • Construction
  • Maritime
  • Restaurants/Takeaways
  • Car Washes
  • Nail Bars

 


In other news this week:

EU Data Protection Compliance: are you prepared?

  • The General Data Protection Regulation (GDPR) will come into effect in the EU on May 25th, 2018. Under the new legislation, data subjects have the right have their data erased, obtain information about exactly what data is being processed, receive a copy of personal data concerning them, and fight decision that affect them that have been made on a purely algorithmic basis.
  • Data science company, Dataiku, has published a white paper detailing how organisations that handle big data can start on the path towards GDPR compliance.
  • The report identifies the following five critical challenges: data storage, aligning teams, accommodating data subject requests, data governance and adaptability.

Click to download the report: Five Essential Pillars of Big Data GDPR Compliance

 

Chinese Supply Costs to Rise

  • An authoritative report from The Beijing Axis titled The China Compass has recommended that organisations recalibrate procurement from China as the country shifts to higher cost and higher value-add manufacturing.
  • The report recommends organisations adapt their supply focus by shifting to tier-2 suppliers in China and tier-1 suppliers in lower-cost Asian countries.
  • China is tipped to provider higher-end solutions and technology in industries where it has gained an advantage.

 

Social Procurement Platform a World First 

  • VendorPanel, an Australian Procurement technology company, has launched an online platform called ProcureForGood to drive positive social and economic change.
  • Reportedly the first such platform of its kind, ProcureForGood brings together multiple verified social procurement databases onto one marketplace platform.
  • The platform is the result of a collaboration between VendorPanel, Supply Nation, BuyAbility (National Disability Service) and Social Traders, and is predicted to be powerful for managing the large volume of low-value procurement (under $150k) that exists within government and corporate organisations.

Visit ProcureForGood.

Image credit: Thedreambuildersproject.com

China’s TIP Demotion: Productive ot Provocative?

2017’s Trafficking in Persons report highlights China as one of the worst global offenders of human trafficking. How does this impact your supply chain decisions? 

The U.S.  government revealed details of its annual Trafficking in Persons (TIP) report last week. The report is the government’s principal diplomatic tool to engage foreign governments on human trafficking.  Rex W. Tillerson, Secretary of State said this year’s report “highlights the successes achieved and the remaining challenges before us on this important global issue.”

The U.S department of state assigns each country to one of three tiers (Tier 1 being the best and Tier 3, the worst) based on their government’s efforts to acknowledge, combat and prosecute instances of human trafficking. Countries must consistently demonstrate improvement in these areas to maintain the highest ranking and avoid demotion.

Myanmar, for example, was one of the countries to be upgraded to Tier 2, following its efforts to reduce child recruitment for the military.

But the most controversial decision this year was China’s demotion to Tier 3, where it will join the likes of Iran, North Korea, Russia and Venezuela.

“China was downgraded to Tier 3 status in this year’s report in part because it has not taken serious steps to end its own complicity in trafficking, including forced laborers from North Korea that are located in China,” Tillerson said as he presented the report.

The demotion marks the first time that  the Trump administration has publicly criticised Beijing’s human rights record, and it prompted an unsurpringly frosty response from the Chinese, “The government’s determination in fighting human trafficking is unwavering and outcomes are there for all to see,” spokesman Lu Kang said. “China firmly opposes the US’ irresponsible remarks on other countries’ fight against human trafficking, based on its domestic laws.”

How Will This Impact China And Global Supply Chains?

There are a number of things to consider if your global supply chain extends to China or other countries ranked in Tier 3.

  • The U.S may consider imposing sanctions that limit access to US and international aid. Congressman Chris Smith said  “Hopefully, the new tier ranking coupled with robust diplomacy—including the imposition of sanctions authorised under Tier 3—will lead to systemic reforms that will save women and children’s lives and ensure that Chinese exports are not made with slave labor.”  Whilst such sanctions have often been waived in the past, it would come as no surprise if Trump decided to break with tradition. Indeed, given his vocal criticism of Chinese trade, he will be under some pressure to impose consequences.  It has been reported this week that Trump is considering trade actions against Beijing including tariffs on steel imports.
  • Suppliers operating in newly placed tier 3 countries will, appropriately, be under increased preasure to audit their supply chains. If you’re sourcing in China, it’s entirely plausible that you’re complicit in trafficking or forced labour.  With supply chains facing extra scruntiny, it would be prudent for organisations sourcing in China to have accurate information at their fingertips. Make sure you know who you are sourcing from, what’s going on behind the scenes of your product and make detailed lists of every farm, vessel or facility to which you are connected.
  • China’s demotion might prompt organisations to stop sourcing in China altogether. Will  “Made in China” labels deter consumers who want to avoid supporting slave labour and traffcking? Changing suppliers, particularly when it’s to a new country,  is time-consuming and expensive. This will be the greatest concern for procurement and supply chain pros.

You can download the TIP Report in full here

What do you think about China’s demotion in this year’s Trafficking in Persons Report? Productive or provocative? Should President Trump impose sanctions on China? Let us know what you think in the comments below. 

In other procurement news this week….

Will Supermarkets Go Uber On Us?

  • Britain’s major supermarkets are testing ‘peak time’ pricing allowing grocers to raise or cut items based on demand
  • Tesco, Morrisons and Mark & Spencer are running trials of electronic labels which allow them to change prices at the click of a button
  • Retail experts say this could spell the end of fixed prices for consumer goods and services within five years, to be replaced by an Uber-style pricing revolution
  • Morrisons said its trial was in the “early stages” and it had not yet decided whether to roll it out across the country

Read more on International Business Times.

Apple Is Moving Its Supply Chain Towards Green Energy

  • Two years ago, Apple embarked on an ambitious plan to help its biggest suppliers switch to clean power sources. As of early June, the tech giant has managed to get eight partners on board
  • According to the tech giant’s latest update on its progress toward environmental goals, integrated circuit packaging maker Ibiden will be the first partner in Japan to power its Apple-related operations completely with renewable energy
  • Apple’s $1.5 billion green bond issued in February 2016 is still the largest issued by any U.S. technology company

Read more on Green Biz.

AI that can read minds 

  • CMU scientists have been working on is a system that can apparently read complex thoughts based on brain scans, possibly even interpreting complete sentences
  • Using a smart algorithm, the team could discern what was being thought about at any given time — and even the order of a particular sentence
  • After training the algorithm on 239 of the 240 sentences and their corresponding brain scans, the researchers were able to predict the final sentence based only on the brain data

Read more on Digital Trends 

 

What To Do When Slavery Is Revealed In Your Supply-Chain

It’s the stuff of every CPO’s worst nightmare; finding evidence of slavery within their organisation’s supply-chain. Sadly, it’s probably more common than you think…

It’s relatively easy to turn a blind eye to modern slavery, particularly when it’s not happening on your own doorstep.

It’s also easy to assume that modern slavery isn’t a prevalent issue in today’s society.

But the stats don’t lie. The Global Slavery Index 2016, produced by the Walk Free Foundation, revealed that over 45 million people are estimated to be affected by modern slavery, more than in any other period in history.

58 per cent of those living in slavery are based in five countries:

  • India
  • China
  • Pakistan
  • Bangladesh
  • Uzbekistan

India, China, Pakistan and Bangladesh all provide low-skilled labour for industries such as food, production, textiles and technology. Uzbekistan is a major cotton exporter.

The Global Slavery Index, which resulted in 42,000 interviews spoken in 53 languages across 25 countries, helps governments, organisations and communities to stay focussed on eradicating modern slavery wherever and whenever it occurs.

Perhaps, given the overwhelming statistics, it’s a case of when, not if, modern slavery will be discovered within your supply chain.

So what do you do when it is?

Red Flags: What will you find?

Firstly, it’s important to understand and look for the red flags, which might be extremely subtle. The likelihood of modern slavery is increased in conflict zones and unregulated sectors, particularly if the jobs are low-income and do not require education or specific skills. Migrant workers, women and children are among the most vulnerable.

Circumstances when passports or identification documents have been removed, excessive recruitment fees are subjected upon migrant workers or subcontractors further outsource work without prior consent are all indicators of exploitation.

Encountering one of these situations may not in and of itself amount to modern slavery but your organisation mustn’t assess anything  in isolation. It’s important to look for the series of signals in order to  decipher whether they paint a clear picture of modern slavery.

Developing a Corrective Action Plan For Modern Slavery

Fiona David, Executive Director of Global Research for the Walk Free Foundation, has some words of guidance and reassurance “My first tip would be ‘don’t panic’.  We know that modern slavery exists in supply chains, so if you find it, you are looking in the right places. The issues that are identified will drive the response”.

Companies responding to modern slavery should develop a corrective action plan based on two fundamental priorities:

  1. The first is short term priority; immediately protecting the victims involved in order to end the abuse
  2. The second is the long term priority.  Companies must find solutions to eradicate the underlying problem which allowed modern slavery to exist in the first place. This may require fundamental shifts in business models or the nature of supplier relationships

These two priorities should underpin every company policy, which should be focused on finding solutions rather than punishments. Critically, those within the organisation and supply-chain must feel safe and confident to speak up, and not fear punishment or recrimination.

Advice from the Walk Free Foundation

  • Be open about what you’ve found: “Companies such as Marks and Spencer, Nike and Rio Tinto and Fortescue Metals Group have all been open about risks identified and violations.”
  • Collaboration is key: Fiona is keen to remind organisations that “no one company can address [modern slavery] in isolation.” Organisations must collaborate with suppliers, competitors in the sector, governments, NGOs, and civil society.
  • Does your organisation have a part to play? Perhaps the culture within your organisation has fuelled the occurrences of modern slavery within your supply chain. Maybe you’re applying unrealistic pressures and time frames? This could be inadvertently encouraging suppliers to use unreliable operators resulting in excessive working hours or under unacceptable work practices.
  • Grievance Mechanisms:These are a formal way for workers to lodge complaints and resolve working condition problems. As well as improving employee satisfaction and productivity, these are crucial in safe guarding workers’ rights. Safe helplines or whistle-blowing procedures must, Fiona explains,  “be freely accessible in appropriate languages, regions and throughout your supply chain, without fear of recrimination.”

What not to do

It might have crossed your mind that an easy solution to tackling, or simply avoiding, modern slavery in your supply-chain would be to pull out entirely from high-risk countries.

Removing Bangladesh, for example, from your supply-chain could be a quick solution to a complicated problem, right?

Wrong!

Communities in countries with high proportions of modern slavery are in desperate need of the economic opportunities your organisation provides. Taking your business elsewhere would only worsen the situation.

Fiona explains the importance of global supply chains because they “create employment and other opportunities for economic and social development, and pathways to help those break the cycles of poverty.” Similarly “immediately terminating supplier relationships is often not the right answer because it can drive the issue further underground.”

The correct, and most socially aware, response is to continue sourcing from these high-risk countries whilst ensuring you have credible audits and systems in place to address any potential problems.

Fiona also makes the important point that “Modern slavery occurs in every country whether developed or under-developed” and so it cannot be avoided simply by vetoing certain countries.  “A recent case found Hungarian workers being exploited in conditions described as ‘modern slave labour’ in a factory in Yorkshire, England.  This factory produced beds, which were supplied to British high street retailers such as John Lewis and NEXT. ”

Procurement needs to share the work load

“Procurement teams are on the frontline,” Fiona asserts. “They manage supplier relationships, they understand the business, the risks and the regions in which they operate. The indicators of modern slavery, being a grievous crime, is actually quite easy to identify, when you know what you are looking for.”

But advocacy groups and investigative reporters mustn’t be the sole figures doing the digging to reveal incidents of modern slavery.

“CSR and Procurement teams should work together across the sectors on these issues, as addressing modern slavery is a “pre-competitive” issue.  Companies can’t compete on sub-standard ethical and criminal practices.”

Searching for modern slavery within your organisation and acknowledging its presence might be one of the tougher pills to swallow but any CPO with a conscience would prefer to reveal and address it head-on. Surely that’s better than burying heads in the sand?

And, as Fiona reminds us “Not only is it the right thing to do morally, but it is also legally required. With laws in the UK, EU and US and debates in Australia about whether to adopt equivalent laws, increasingly it is no longer a voluntary issue, businesses must look at these issues and report on them.”

Fiona David, Executive Director of Global Research,  Walk Free Foundation, will be delivering a keynote speech at PIVOT: The Faculty’s 10th Annual Asia Pacific CPO Forum.

A Noble Cause: CIPS CEO David Noble’s Enduring Legacy

From his fight against modern slavery to his campaign to licence the procurement profession, Procurious highlights the enduring legacy of the late CIPS CEO, David Noble.

David Noble’s professional accomplishments were many and varied, both within his role as CIPS Group CEO and during his stellar career beforehand. After his sudden and untimely passing late last week, however, there have been tributes from procurement leaders around the world. The tributes emphasised two of Mr Noble’s stand-out achievements.  Firstly, his fight against modern-day slavery and secondly, his work in promoting and licensing the procurement profession.

The crusade against modern slavery

In an interview with Procurious before his appearance at the Big Ideas Summit, David Noble stressed that the profession is in a unique position to drive the eradication of modern slavery. “Whether it’s child labour, inhumane working conditions, forced labour or slavery, there is no doubt that the procurement and supply profession has a unique opportunity to step up to this challenge as a professional community and effect real change”.

Mr Noble believed that in terms of corporate social responsibility, procurement has come to a significant crossroad and needs to adapt to survive in the face of rapidly-changing parameters, starting with accountability.

“Accountability for inadequate or exposed supply chains now goes right to the top, with the company’s reputation on the line. Good corporate supply chain governance demands accountability, and to have accountability means the appropriate authority and capability to act.”

The  2015 Modern Slavery Act

2015 was a watershed year for Mr Noble and his crusade against modern slavery, with two significant milestones taking place. Firstly, the UK Government signed into law the 2015 Modern Slavery Act, after seeking considerable guidance from CIPS while the Act was being created. CIPS was sought out as a subject-matter expert due in no small part to its 2013 partnership with Traidcraft and Walk Free, which led to the creation of the Ethical and Sustainable Procurement Guide. The Guide helped procurement professionals identify suppliers who subjected workers to poor wages, inhumane conditions or forced labour, and advised them on how to put preventative measures in place. Following the release of the Guide, CIPS also created an ethical e-learning course and test, which covered corruption, fraud, bribery, exploitation, human rights and forced labour.

After the Modern Slavery Act was signed, Mr Noble’s message to the profession was again focused on accountability: “For too long supply chain transparency has been overlooked, and we hope that this legislation sends out a clear message to business leaders that they are accountable for all discrepancies, no matter how far down the chain.”

Vatican City declaration  to eradicate modern slavery

The second milestone that took place in 2015 was Mr Noble’s invitation to Vatican City to witness a historic signing by faith leaders of a joint declaration to eradicate modern slavery. Leaders from the Buddhist, Christian, Hindu, Jewish and Muslim faiths signed the declaration, which had been developed by Andrew Forrest’s Global Freedom Network. Mr Noble was invited as a guest of Andrew Forrest and also by the Archbishop of Canterbury Justin Welby, in recognition of CIPS’ work in addressing modern slavery and the integral role supply chain management will play in the ongoing campaign.

Many of the tributes to Mr Noble published on Procurious called out this aspect of his career, beginning with CEO ISM Tom Derry, who wrote that “[David’s] moral vision and leadership was instrumental in CIPS’ crucial role in the passing of the U.K.’s Modern Slavery Act in 2015.”

CIPS General Manager for the Asia-Pacific region, Mark Lamb, wrote: “He was particularly vocal about ethical procurement, eradicating bribery and corruption, and ensuring that supply chains are free from modern slavery.” Similarly, The Art of Procurement host and producer Philip Ideson wrote about Mr Noble’s “leadership of efforts to eradicate slavery across the supply chain, impacting millions of workers without their own voice”.

Broadspectrum’s Executive General Manager of Procurement, Kevin McCafferty, worked closely with Mr Noble on the development of the Ethical Procurement Guide: “David was instrumental in getting the UK Government to introduce the Modern Slavery Act 2015.” Mike Blanchard, Deputy Chief Executive Operations at the New Zealand Tertiary Education Commission, wrote that Mr Noble’s focus has led to CIPS becoming “a professional body with ethics as a pillar”.

Licensing the profession

When Mr Noble was asked to bring his “Big Idea” to London as part of Procurious’ 2015 Big Ideas Summit, the subject for him was a no-brainer. “My big idea is something we have as a policy statement – licensing the profession,” he told the camera. Watching his comments today, it becomes immediately clear that his drive to license the profession was inseparable from his campaign to improve ethics in procurement and, ultimately, eradicate modern slavery.

The need for CIPS to licence the profession became increasingly apparent to Mr Noble as he received calls from the media after supply chain disasters linked to malpractice or ethical breaches. Reporters asked him the simple question: “Why is the procurement and supply profession allowing this to happen?”

Bringing accountability and consequence to procurement

It was difficult to bring accountability and consequences to those on the front line who were making decisions that led to malpractice and reputational risk. Licensing, said Mr Noble, was therefore the answer. “There’s a huge public good agenda linked to supply chains around the world … [and] companies are increasingly realising that having licensed supply professionals makes a real differentiator to success.”

Licensing brings with it the threat of consequences: “If they behave unethically, they stand to lose that license and they’ll find it difficult to work in the profession again,” said Mr Noble. “But the good side is that it gives them the protection of saying ‘You’re putting my professional license at risk’ if they’re ever asked to do something unethical or wrong.”

CIPS President and former Rio Tinto CEO Sam Walsh noted Mr Noble’s extraordinary achievements in moving forward with the professionalisation of procurement: “His initiatives such as training, licensing of procurement professionals, establishment of standards for anti-corruption, anti-bribery and anti-modern slavery have led to CIPS being highly regard by governments, employers and members.”

Visna Lampasi, General Manager Group Procurement for Woolworths (Australia) also commented on Mr Noble’s “energy behind licensing the profession … and major contribution to procurement’s development”.

 A legacy of thought-leadership

A valued contributor to the Procurious Blog, Mr Noble appeared at the Big Ideas Summit in 2015. His thought-leadership published on Procurious includes:

This article concludes our three-part series honouring the achievements and memory of CIPS CEO David Noble. Readers can leave a tribute to Mr Noble on the Procurious discussion board.

Modern Slavery Act 2015: Supply Chain Transparency Requirements

In October 2015, the UK government issued statutory guidance relating to supply chain transparency and reporting obligations of the Modern Slavery Act 2015.

Modern Slavery Act

This article was first published on Greenstone.

The document confirms who is required to comply and when they need to comply by, as well as including essential details on the all-important annual statement. You can read the document here.

Here is everything you need to know and what you need to do.

Background

Consolidating UK law on slavery and human trafficking, the Modern Slavery Bill was first introduced to parliament on 10th June 2014, and subsequently passed into law on 26th March 2015.

With the aim of preventing employment exploitation and increasing disclosure of labour practices, the Modern Slavery Act introduces new grounds of compliance for commercial entities. Not only do organisations need to ensure that modern slavery is not an issue in-house, they also need to take, and report on, actions to prevent the issue from occurring within their supply chains.

Which Companies are Captured?

The threshold to determine which companies have to adhere to the Modern Slavery Act has been something of a discussion point for the vast majority of the year.

Following a government consultation period earlier in the year, it was confirmed that the Act applies to any organisation that supplies goods or services and that has a turnover exceeding £36 million, aligning the legislation with the definition of a ‘large business’ in the Companies Act 2006.

Furthermore, this threshold is valid for any organisation that has operations in the UK, regardless of where it was formed. This means that many non-UK organisations, providing goods or services within the UK’s geographical boundaries, will have to engage with their suppliers, essentially resulting in diverse, complex and global supply chains being assessed.

Annual Statements

A key part of the Modern Slavery Act is the stipulation that captured organisations need to prepare and publish an annual statement. The statement details the ongoing process they are taking to ensure that there is no modern slavery within their business and supply chains.

To be published at the end of the organisation’s financial year, and required to be approved at board level, the statement must be publicly available via a prominent link on the company’s corporate website homepage.

What does the statement need to look like?

There are 2 routes that organisations can go down when it comes to preparing the slavery and human trafficking statement. Captured organisations must prepare and publish either:

  1. A statement detailing steps the organisation has taken during the financial year to ensure that slavery and human trafficking is not taking place in any part of its own business or supply chains; or
  2. A statement that the organisation has taken no such steps.

Although Option 2 is the simpler journey, having a publicly available statement that effectively says that the organisation does not care about the issue of modern slavery risks a backlash from stakeholders. As such, the safest route to compliance is certainly the first.

In terms of what the annual statement needs to looks like, the Act does not stipulate the exact parameters, but does provide some key areas that should be covered:

  • the organisation’s structure, its business and its supply chains;
  • its policies in relation to slavery and human trafficking;
  • its due diligence processes in relation to slavery and human trafficking in its business and supply chains;
  • the parts of its business and supply chains where there is a risk of slavery and human trafficking taking place, and the steps it has taken to assess and manage that risk;
  • its effectiveness in ensuring that slavery and human trafficking is not taking place in its business or supply chains, measured against such performance indicators as it considers appropriate;
  • the training about slavery and human trafficking available to its staff.

What do captured organisations need to do?

The statutory guidance confirmed that the supply chain transparency and reporting provisions of the Modern Slavery Act commenced on 29th October 2015.

However, a transitional period applies to businesses with a financial year-end date between 29th October 2015 and 30th March 2016, meaning those who have a year-end of 31st March 2016 will be the first to publish the statement.

So what should companies be doing to prepare for these new supply-chain requirements? Regardless of when the year-end date is, it is imperative that organisations start engaging with their suppliers now and assess the level of risk. Without an extensive, and ongoing, information gathering exercise, taking steps to prevent the risk and subsequently reporting on them is simply not possible.

Where to start

As it is now a requirement for companies to collect and interrogate data from across their web of suppliers, it is essential that they make the process as efficient as possible.

We understand that this can be a complex and time-consuming process. The traditional offline data collection methods are not suited to the demands of today’s globalised supply chains. As such, it is an increasing trend for companies to move the process online.

For advice on what you need to consider when moving your supplier risk and compliance process online, please read our previous blog article on the subject.

Gyles is Head of SupplierPortal at Greenstone, a non-financial reporting solutions company providing software and supporting services to clients in over 100 countries.

Greenstone’s SupplierPortal solution enables buyers to effectively manage supplier risk and compliance through a secure and private online platform. Buyers have the flexibility to distribute standard framework questionnaires, as well as proprietary questionnaires, to their suppliers and can then manage and analyse this information through a comprehensive suite of analytical tools.

Supply Chain Transparency: Why We Need It More Than Ever

As scrutiny over supply chain practices increases, organisations need to ensure supply chain transparency, from Tier 1, all the way down.

Supply Chain Transparency

This article was first published on Greenstone.

As non-financial reporting frameworks and requirements for organisations evolve, so does the need for transparency throughout supply chains. There is an ever increasing emphasis within current, and upcoming, regulations on being able to demonstrate a deeper understanding of your suppliers and vendors.

Most recently we have seen evidence of this advancing mood through the UK Modern Slavery Act, the EU corporate disclosure directive, and, of course, the Dodd Frank Act covering conflict minerals.

Last summer UK Prime Minister David Cameron further clarified the criteria surrounding the UK government’s commitment to anti-slavery and supply chain transparency in a speech in Singapore.

The prime minister stated: “From October [2015], we will also require all businesses with a £36 million turnover or above to disclose what they are doing to ensure their business and supply chains are slavery free. This measure is one of the first of its kind in the world, and it will be a huge step forward, introducing greater accountability on business for the condition of their supply chains”.

Legal Requirements

Guidance for compliance with the Modern Slavery Act was published in October 2015. And businesses with a turnover of greater than £36 million have some work to do. This includes involving internal buyers and procurement departments so that they are aware of any potential implications of the Modern Slavery Act, and can prepare to embed it in their processes. As well, as including the requirements into any current audit practices.

Supply chain transparency is also being driven by EU Directive 2014/95/EU, relating to disclosure of non-financial and diversity information. This requires by 2017, that all companies concerned (all companies based in the EU with over 500 employees) disclose in their management report, information on policies, risks and outcomes with regards to the following:

  • Environmental matters;
  • Social and employee aspects;
  • Respect for human rights;
  • Anti-corruption and bribery issues; and
  • Diversity in their board of directors.

Even though there are already mandates around CSR reporting in some EU countries, and many large enterprises already report on their environmental and social impact, the new directive will demand further commitment, as it also requires disclosure on the supply chain.

Placing Responsibility on Companies

The Dodd Frank Act, also known as the conflict minerals law, has been in operation for over two years. Under the law, over 1000 U.S. listed companies report their conflict minerals status to the Securities and Exchange Commission.

The law is designed to reduce the risk that the purchase of minerals from Central Africa contributes to conflict or human rights abuses. It places a responsibility on companies to be able to trace the designated minerals throughout their supply chain. This is something that can only be achieved through increased transparency of information at all levels.

Companies have struggled to accurately disclose information through their conflict minerals reports. They may also struggle with the Modern Slavery Act and the latest EU Directive. Like organisational level, non-financial reporting before it, supplier information disclosure and supply chain transparency is a new way of working for many businesses.

Those that address this area now will be creating robust processes that ensure a competitive advantage, as well as being well positioned for future legislation.

Role of Software

At Greenstone, we are increasingly seeing organisations turning to software solutions. This is not only to drive supply chain transparency, but to enable organisations to handle the burgeoning reporting requirements, and stakeholder expectations, efficiently.

Previously, supplier compliance has been a box ticking exercise for organisations. The processes of data gathering were ill conceived and incomplete, and information gathered was rarely interrogated, and almost certainly not used for reporting purposes. This lead to disillusionment amongst suppliers, and even lower levels of engagement.

However, we are now seeing that users of SupplierPortal are utilising the analytical tools available to manage suppliers and their data. The increasing emphasis on transparency and reporting means that organisations are no longer ticking boxes, but adopting new processes and procedures in order to identify and manage non-compliance.

What is more, is that this doesn’t have to consume a great deal of additional resource, but rather for organisations to acknowledge a new way of working, and realign current practices.

Gyles is Head of SupplierPortal at Greenstone, a non-financial reporting solutions company providing software and supporting services to clients in over 100 countries.

Greenstone’s SupplierPortal solution enables buyers to effectively manage supplier risk and compliance through a secure and private online platform. Buyers have the flexibility to distribute standard framework questionnaires, as well as proprietary questionnaires, to their suppliers and can then manage and analyse this information through a comprehensive suite of analytical tools.

Big Ideas in Procurement Technology

Procurement technology – you can’t get away from it! But what Big Ideas can we expect from this area in the coming years?

Procurement Technology

Ahead of the Big Ideas Summit 2016 on April 21st, we are taking a look at the key issues facing procurement in the coming years. We have asked experts and influencers in our community to share their Big Ideas on the themes we will be discussing on the day.

Here, our experts and influencers share their thoughts on the Big Ideas impacting organisations and industries in the field of procurement technology.

Meghan Huynh, Content & Marketing Associate, Winddle

Meghan HuynhWhen we discuss the importance of collaboration, interdepartmentally and with external partners, it is a case for visibility and how it is key to better procurement process.

Not all processes are broken, but most are inefficient. This is where technology comes in – to connect contributors in a project and make sure that their status of the entire operation is updated in real time.

The bottom line here is let’s get everyone on the same page so that we can all perform to the best of our abilities. Procurement technology needs to give the opportunity to identify and eliminate inefficiencies through connectivity. When people are better connected, relationships can effortlessly develop which is known to increase productivity and accuracy.

The main idea to remember is that this can only be executed to it’s intention if end users and upper management truly believe in the possibilities that collaborative technology can bring, and are committed to improving the procurement process.

Anya McKenna, Marketing Manager, Market Dojo

Anya McKennaMarket Dojo‘s Big Idea for the Procurious Big Ideas Summit 2016 is that there will be an increased focus on the information companies hold on suppliers.

The Modern Slavery Act 2015 consolidates previous legislation and introduces new measures to combat slavery and human trafficking.

We’ve already seen companies take extra measures by adopting supplier on-boarding solutions. We predict this will become the focus of many more organisations.

Oliver Oram, Founder, Chainvine

Oliver OramPhysical flows captured and identified by digital finger prints through one shared ledge, would help achieve greater visibility of all corporate assets. One could imagine a scenario of fish being traced from tackle to table, via Blockchain technology. This near real-time tracking of elements in the supply chain have been, until today, too costly and difficult to audit.

Blockchain as a shared ledger among supply chain connections could today be identified as one of the best means of applying such a management interface. What is needed is that companies identify the most optimal meta-data structure to enable effective and simple ways of search and retrieval of such data.

The best way to implement such a change would be in picking small non critical business areas in which to apply this technology first, but ones that can show a real tangible value in using such a technology. Chainvine is now involved in more projects where we have begun to merge both digital and physical aspects of the supply chain and are exploring both transparency and efficiencies.

Simona Pop, Head of Sales & Marketing, InstaSupply

Simona PopIncorporating an online network aspect to the procurement process is a key move in simplifying buyer-supplier relationships. We are so accustomed to the efficiency of ‘one-click’ interactions in our personal lives, that not extending this technology into our business practices is nonsensical. 

Working smarter, not harder, and making use of clever online tools will be the main procurement trends going forward. Eliminating paper, a real time view on all spend, and cloud based location purchasing management will be the staples of successful, efficient procurement. 

Kate Lee, Senior Director of Research & Strategy, Fronetics

Kate LeeThe B2B buying process is not what it used to be. Unfortunately, many companies have not adapted their sales and marketing strategies accordingly and are, therefore, missing out on attracting, engaging, and acquiring customers.

Today, B2B buyers are spending more time researching and evaluating products than ever before. Key places where they turn to conduct research are social media and vendor-focused content (e.g. case studies, white papers, product data sheets). Given this, the average buyer now progresses nearly 60 per cent of the way through the purchase decision-making process before engaging with a sales rep. 

Given this new reality, it is important for companies to recognise that content marketing should be a part of their strategy. Content marketing gives companies a way to meet buyers where they are (online) and provide buyers with the information for which they are looking (knowledge). 

Do you work with, or have a passion for, procurement technology? Tell us your Big Idea in this critical field and we could be discussing them on April 21st.

Want to know more about Big Ideas 2016? Then visit www.bigideassummit.com, join our Procurious group, and Tweet your thoughts and Big Ideas to us using #BigIdeas2016.

Don’t miss out on this truly excellent event and the chance to participate in discussions that will shape the future of the procurement profession. Get Involved, register today.