Big business bullying: next government should act
Its chief executive slammed ‘bullying’ in the retail sector which, he claimed, had spread to food manufacturers.
“The scale of domination and anti-competitive behaviour in the grocery retail sector is now so great that even our largest manufacturers of food, drink and dairy products are adopting unethical business practices with their own supply chains,” said Phil Orford.
“Late payment, retrospective discounts and late delivery fines are just some of the practices hurting the very businesses, many of them small employers, who do so much to support the production process of these major manufacturers.”
He urged the next government to take urgent action to improve business ethics, while businesses should back the FPB’s five-fold pledge. (See panel).
‘Bullying in the grocery and food sectors’
“Decades of inaction to address market domination and subsequent bullying in the grocery and food sectors has directly led to the problems we face today, with the burden of large corporate under performance and bad management being passed down the supply chain to the very smallest of private and family owned businesses, said Orford. The effect on this smaller business can be devastating, often leading to closure or job losses with negative social impacts for local communities, he added.
Business ethics pledge
- Promote responsible business in the UK
- Treat our suppliers as we wish to be treated
- Build long-term relationships with local enterprises
- Challenge industry to operate openly & ethically
- Partner with SMEs to create jobs & boost local economies
The FPB claimed there was widespread public support to ensure businesses of all sizes were able to operate on a level playing field. The forum had commissioned a poll of 2,000 British adults, which revealed a crisis of trust in big business.
The survey, conducted by ComRes, showed that more than three quarters (78%) of people agreed big businesses was more likely to prioritise profits over high ethical standards. A further 74% agreed most big businesses have no concern for small business owners.
Promote ethical practices
About three quarters (72%) thought the next government should make it a priority to promote ethical practices among big businesses.
“In a free market economy, it is vital that small and large business are able to operate on a level playing field,” said Orford. “Power and domination shifts that balance and government has an obligation to ensure that unethical monoliths don't abuse that power by bullying their suppliers.”
The survey revealed “an ethical deficit” at the heart of big British business, with the public concerned about a range of problems from tax avoidance and high street domination to late payment and supply chain abuse. “Every week our members tell us that some of the biggest names in British business are threatening their livelihoods,” said Orford.
“There must be a balance between the need to attract the world’s biggest companies to Britain, ensuring we have the best environment for business, and protecting the interests of the UK’s hardworking independent small business people.”
But the British Retail Consortium rejected the forum’s claims. Its director of food and sustainability Andrew Opie told FoodManufacture.co.uk: “He [Orford] has no evidence to justify his claim that retailers are in any way involved in the recent behaviour of large branded manufacturers.
“Unlike manufacturers’ dealings with their suppliers, retailers are covered by a comprehensive code to ensure the practices he alleges are prevented.”
Meanwhile, earlier this week the Groceries Code Adjudicator Christine Tacon unveiled an official investigation into claims Tesco had mistreated its suppliers.
Last year, food manufacturing giants 2 Sisters Food Group and Premier Foods drew flak for their treatment of small-scale suppliers.
