Executive Briefings

Are You Adequately Vetting Your Suppliers?

A lean, agile supply chain network is important in the hyper-competitive global marketplace, but this increased reliance on contractors and their subcontractors brings all kinds of increased risk and with it a heightened responsibility to closely vet and monitor supplier performance and behavior.

Fortune 1000 firms face real complexity in protecting their ethical imperatives, image and standing, when they can have as many as 10,000 or more suppliers under contract. How those contractors behave while doing work can make or break multibillion-dollar corporations. Government regulation enforces social responsibility, and consumers punish companies that don't handle themselves responsibly, as we have seen in recent headlines.

Volkswagen is expected to lose billions of dollars and significant market share because of ethical lapses. But what about suppliers? Nike has come under scrutiny over the years for its suppliers' alleged labor exploitation around the world. Tesco is one of the food manufacturing companies that in recent months were adversely impacted by horse meat found in its products.

What's more, consumers are now demanding country-of-origin information on shrimp in restaurants and stores after a recent investigation by Associated Press revealed that shrimp peeled by modern day slave labor in Thailand is making its way into the U.S., including through major food stores and retailers such as Walmart, Kroger, Dollar General and Petco.

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Fortune 1000 firms face real complexity in protecting their ethical imperatives, image and standing, when they can have as many as 10,000 or more suppliers under contract. How those contractors behave while doing work can make or break multibillion-dollar corporations. Government regulation enforces social responsibility, and consumers punish companies that don't handle themselves responsibly, as we have seen in recent headlines.

Volkswagen is expected to lose billions of dollars and significant market share because of ethical lapses. But what about suppliers? Nike has come under scrutiny over the years for its suppliers' alleged labor exploitation around the world. Tesco is one of the food manufacturing companies that in recent months were adversely impacted by horse meat found in its products.

What's more, consumers are now demanding country-of-origin information on shrimp in restaurants and stores after a recent investigation by Associated Press revealed that shrimp peeled by modern day slave labor in Thailand is making its way into the U.S., including through major food stores and retailers such as Walmart, Kroger, Dollar General and Petco.

Read Full Article