Food manufacturers ‘don’t know their supply chains’

By Laurence Gibbons contact

- Last updated on GMT

More than half of global food manufacturers do not know their suppliers
More than half of global food manufacturers do not know their suppliers

Related tags: Supply chains, Food manufacturers, Management

More than half of global food manufacturers have admitted not knowing the precise details of their supply chains, raising concerns about the prevalence of slave labour and other unethical working practices, according to research from risk management firm Achilles.

Over half (53%) of large food manufacturers said they had no way of finding out who is in their supply chain, according to the survey of 42 firms across the UK, US, Spain, Brazil, Australia, South Africa and the Middle East.

Almost one in five (19%) admitted they didn’t even have a way of finding out the name and address of suppliers in their supply chain – despite scrutiny paid to food supply chains in the wake of the horsemeat crisis of 2013.

Slave and child labour

Without this “basic information”​ in place, food manufacturers risk unknowingly supporting hidden slave labour, child labour or unethical working practices, Achilles director of fast moving consumer goods Paul Carr claimed. This could have a powerful impact on sales and reputation.

“To prevent a ticking timebomb of risk, we recommend large businesses map their supply chains through all tiers to identify and tackle potential risks,”​ Carr said.

Survey in numbers

  • 53% of global food manufacturers have no way of finding out their supply chains
  • 19% have no way of finding out name or address
  • 40% expect mounting legislation

“With a clear picture of who is in the supply chain, businesses can implement clear standards on ethics, which suppliers must adhere to before they are even considered to provide goods and services.”

Exposed to damage

The survey also found (12%) of food companies did not have in place corporate standards which suppliers must adhere to, on issues such as ethics, and health and safety.

As a result, 40% of food manufacturers believed it was ‘likely or very likely’ they would be exposed to mounting legislation and almost a third (29%) said it was ‘likely or very likely’ they would be exposed to reputational damage.

Businesses found to be using unethical labour in supply chains face hefty fines under various laws such as the UK Government’s Modern Slavery Act.

The study was carried out by independent research agency IFF and commissioned by Achilles.

Related topics: Supply Chain, Manufacturing

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