Corporate Social Responsibility (CSR) programmes - how businesses align their values and behaviour with the economic, social and environmental impact of their activities - are having a greater impact on the way in which companies select and trade with suppliers than ever before.
"There's good evidence that CSR issue are beginning to seriously affect the supply chain, said Daniel Ball, Director, Wax Digital, especially where those suppliers are selling into larger organizations.
"Only last month McDonalds stopped sourcing tea from Tetley because the company is not certified by the Rainforest Alliance - even though it does belong to the rival Ethical Tea Partnership.
"Likewise, Starbucks terminated the contracts of 14 suppliers after an audit revealed they failed to meet the CSR standards set for its suppliers."
Managing and monitoring compliance across a large supply chain can be a major task, however, and that is why many companies are turning to eProcurement providers to deliver not simply savings and control across their spend, but also the tools to effectively drive CSR programmes through the supply chain.
"Wax Digital eProcurement solutions save our customers millions of pounds a year by introducing control and compliance into corporate spend. But they also enable efficient processes to be introduced around areas such as introducing new suppliers.
Whilst historically many businesses have struggled even to get new suppliers set up on the financial system for payment, our systems help them streamline and manage the whole process. That includes everything from automating the credit check process, to electronically enabling and monitoring the environmental and social checks that underpin a CSR programme."
Suppliers therefore need to get their house in order, since it is clear that buyers are no longer simply paying lip-service to CSR, and they are increasingly getting the tools to help them ensure compliance, and ultimately penalise non-compliance.
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