Supermarkets study ethics to overcome supply problems

By Anita Awbi

- Last updated on GMT

Related tags: Supply chain, Fair trade, Tesco

Marks and Spencers and Sainsburys are sending senior managers on a
new training course that promises to teach mainstream business
leaders about the ethics of product sourcing in a bid to improve
supply chain relations.

The Ethical Trading Initiative (ETI), a body of trade unions, companies and non-government organisations (NGOs), has devised the course and hopes to attract big name retailers to sign up.

A total of 36 companies are already enrolled on the scheme aimed at encouraging UK companies to have better relations with primary producers.

Julia Hawkins, ETI marketing manager, told FoodandDrinkEurope.com​: "It came out of this feeling that the way companies have dealt with workers' conditions and supply chains isn't really sustainable in the long term."

"Increasingly companies are beginning to see there is a win-win situation between business and ethics. If a company has a more long term relationship with suppliers, it can build a relationship of trust - and this will bring risk management opportunities and efficiency gains for retailers who can really rely on their producers in the supply chain."

Capitalising on the publicity of this year's Make Poverty History and Trade Justice campaigns, and the rising public awareness of fair trade issues, the ETI course offers practical advice and training for retailers wishing to change their sourcing practices.

The fashion industry has long been aware of the PR 'kiss of death' when dealing with unethical suppliers across Latin America and South East Asia. Gap and Nike are both recovering from supply chain scandals that saw profits tumble after reports uncovered exploitation of workers.

But now the food industry is coming under fire to recognise their responsibilities too, according to ETI NGOs.

Julia Dobson, Marks and Spencer ethical trade manager, says the desire for such a course has come from a growing awareness among retailers wanting to improve working conditions in the supply chain, explaining that "auditing alone does not bring about sustainable change."

Marks and Spencer wants to put workers' rights "centre stage"​ by sending its technologists and buying managers to learn about supply chain issues.

The course has attracted financial backing from the British government following a parliamentary presentation by Baroness Amos, Leader of the House of Lords, in which she stated UK company "commitments must be backed up by action".

"Consumers want to be assured that the food we eat and the clothes we wear are from reputable sources,"​ she added.

The Department for International Development has also pledged support.And members of the ETI, including Sainsburys, Chiquita and Premier Foods, have contributed.

Recently both Tesco and Asda have borne the brunt of fair trade campaigns by NGOs ActionAid and War On Want, aimed at raising consumers' awareness of the retailers' supply chain policies.

And a growing number of businesses are recognising the commercial value of ethical trade policy. Food giants Nestle has introduced Partners, a fair trade coffee brand, and Cadburys has acquired ethical chocolate company Green and Blacks.

Related topics: Market Trends

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