Achilles: Food Manufacturers Face Ethics Risk from 'Hidden Suppliers'

Firms urged to map supply chains to protect vulnerable workers

February 17, 2016 04:40 AM Eastern Standard Time

LONDON--(BUSINESS WIRE)--Food manufacturers across the globe have admitted failing to put in place basic safeguards to protect vulnerable workers in their supply chains – almost one year on from laws to stop slavery, child labour and unethical working practices.

“Without knowing who is in the supply chain, or having basic information about how contractors do business, food manufacturers are putting themselves at risk of using ‘hidden’ slave labour, child labour or unethical working practices.”

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In total, almost one in five (19%) of large food manufacturers admitted they don’t have a way of finding out even the name and address of suppliers in their supply chain – a basic first step for identifying and ending abuses. More than half of large firms (53%) admitted they do not have a plan in place to find out in the future who is in their supply chain.

Further, more than one in 10 (12%) food companies admitted they do not put in place corporate standards which suppliers must adhere to, on issues such as ethics, and health and safety - according to a survey of 42 large food manufacturers across the UK, USA, Spain, Brazil, Asia, Australia, South Africa and the Middle East. The study was carried out by independent research agency IFF and commissioned by Achilles – a global supplier risk management company.

As a result, 40% of food manufacturers believe it is ‘likely or very likely’ they will be exposed to mounting legislation; and almost a third (29%) say it is ‘likely or very likely’ exposed to reputational damage.

Luis Olivie, Global Business Development Director for Achilles, said: “Without knowing who is in the supply chain, or having basic information about how contractors do business, food manufacturers are putting themselves at risk of using ‘hidden’ slave labour, child labour or unethical working practices.”

Businesses found to be using unethical labour in supply chains face hefty fines under various laws such as the UK Government’s Modern Slavery Act.

“To prevent a ticking timebomb of risk, we recommend large businesses map their supply chains through all tiers to identify and tackle potential risks. With a clear picture of who is in the supply chain, businesses can implement clear standards on ethics, which suppliers must adhere to before they are even considered to provide goods and services,” added Mr Olivie.