COVID-19: Ethical Dilemma Reveals Weaknesses in Supply Chain Due Diligence

May 22, 2020 EcoVadis ‏‏‎

This Dilemma Could Have Been Anticipated
But, as we advance through this COVID-19 crisis, and as business evolves into a New Normal, an essential lesson must be imbibed: the need for multinationals to carefully select their suppliers with regard to human rights issues. According to the ILO, more than 40 million people are victims of modern slavery. However, sub-contractors cannot start being audited only once thousands of lives are at stake. It needs to be anticipated. The efforts are still insufficient: The 2019 Sustainable Procurement Barometer (developed in partnership with the NYU Stern Center for Sustainable Business) reveals that even if 64% of large, multinational groups have a supplier code of conduct, only 38% of them evaluate their partners every year. And once there is a shortage, the buyers’ only solution is to bypass their principles of corporate social responsibility (CSR). This may further imperil companies from a legal standpoint, as the regulatory landscape on supply chain due diligence has been accelerating over the past five years. Now, finally, laws such as the French “duty of care” (devoir de vigilance) of parent and subcontracting companies, adopted in 2017, and the UK Modern Slavery Act enacted in 2015 are today taking on their full meaning. 

About the Author

EcoVadis ‏‏‎

EcoVadis is the world’s most trusted provider of business sustainability ratings, intelligence and collaborative performance improvement tools for global supply chains. Backed by a powerful technology platform and a global team of domain experts, EcoVadis’ easy-to-use and actionable sustainability scorecards provide detailed insight into environmental, social and ethical risks across 198 purchasing categories and 155 countries.

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