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Author: Brian M

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Human Rights and Modern Slavery violations in the Leicester textile supply chains

textile supply chain leicester
textile supply chain leicester
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When we think about modern slavery in the textile industry, we may think about the concentration camps that are prisons to the Uyghur people in the Xinjiang region of China, where 20% of the world’s cotton originates.

However, since 2020, there has been a large-scale operation in Leicester, responding to reports of exploitation and underpayment within the textile sector.  A recent report by the Low Pay Commission (LPC) details how textiles manufacturing in Leicester has been the focus of substantial enforcement activity.

The human right and modern slavery abuses go back further, with reports as far back as 2014 outlining employees of the Leicester textile sector earning just £3 an hour!

The report pulls together evidence from workers, manufacturers, retailers, and enforcement bodies to understand and place context against this activity.  Previously, documentaries have shone a light on Leicester’s textiles sector such as the Channel 4’s Dispatches investigation.

Whilst the report outlines that fear, job insecurity and low expectations are among the factors for Leicester textile workers’ unwillingness to report their underpayments and working conditions.  This is as a result of most workers just being grateful to be employed whilst others are worried their hours would be reduced and therefore lose valuable income.

At the height of Covid-19, Leicester and their textiles manufacturers were the focus of media attention as reports of poor working conditions were enabling transmission of the virus.

Biometric machines for workers to clock-in and clock out could control the practice of overwork and underpay – although supply chain auditors found this could be circumvented by hiding a secondary machine or using a separate paper record.

Recently Missguided went into administration with considerable debts owed to suppliers, including Leicester based manufacturers.  The debts owed to manufacturers will often mean that they’re unable to pay their workers and often results in loss of employment.

In 2020, the Boohoo Group sought an independent review with four core objectives after media allegations suggested that there were unacceptable working conditions and underpayment of workers at premises owned and controlled and operated by some of Boohoo Group’s suppliers, principally in Leicester.

The four core objectives for this independent review are: 1) To investigate the allegations made in relation to the Leicester supply chain and determine whether they are well-founded; 2) If they are, to consider the extent in which the Boohoo Group monitored its Leicester supply chain and had knowledge of the allegations; 3) to consider the Boohoo Group’s compliance with the relevant law; and 4) To make recommendations for the future in response to those finds.

The report by Alison Levitt QC outlined 6 months to three year plans to support Boohoo Group’s supply chain that included upskilling manufacturers to improve their productivity and develop the skills to manufacture more sophisticated clothing,  competing with that produced in overseas factories as well as training their own buyers in the actual cost of fabricating garments and therefore buyers do not drive cost prices below what is reasonable.  Short term plans include mapping their supply chain to reduce its approved suppliers to a list that contains a manageable number of manufacturers without reducing capacity.

Eradicating Modern Day Slavery from your Supply Chain

Retailers are recommended to register to the Ethical Trading Initiative, a UK based independent body that continuously monitors private sector organisations supply chains in accordance with their ethical code.

Ensure your supply chain acts in accordance with the UN Guiding Principles on Business and Human Rights (UNGPs) and conduct due diligence in line with these principles by assessing the immediate adverse human rights impacts on works.

More and more retailers have taken steps to reform their supply chain by ensuring manufacturers adhere to their own code of conduct.  This code of conduct makes clear to manufacturers that transparency over wages and working conditions are adhered to and that subcontracting is abolished.  This is further backed by retailers taking a hard-line approach and has already seen several manufacturers removed from their supply chain.

Many retailers have joined industry forums such as the Apparel and General Merchandise Public Private Protocol (AGMPPP).  This forum brings together retailers, unions, enforcement bodies and local authorities to discuss progress around non-compliance, modern slavery and other key issues within their supply chain.

Global transportation costs, Brexit and Covid-19 are contributing factors to retailers seeking UK based manufacturers and the Government need to invest more, now, in the UK textile sector.  By reducing the need to offshore this sector, this will reduce the impact supply chains have on climate change whilst supporting the UK economy.

It is worth all procurement and supply chain professionals understanding the ethical, reputational and disruption that will be caused by poor human rights standards and modern slavery within their supply networks, irrespective of whether you are part of a public or private sector organisation.

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How are Wildfires Disrupting your Supply Chain?

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In 2019, there were reportedly 74,155 fires in The Amazon rainforest (supplies 20% of earth oxygen).  This was a year on year in increase of 85% since (2018), according to a Washington Post report.  The UK, Spain, France and Portugal have recently faced unprecedented heatwave causing wildfires across western Europe and disrupting supply chains locally and globally.

These fires are a direct result of climate change. Organisations who enable deforestation for leather and food such as soya and beef are directly contributing to the problem of efficient global supply chains.  One of the most common falsehoods is that “deforestation is only driven by food and packaging supply chains”.  This is simply not true, if we look at it in a broader sense the risk can be found in numerous sectors; rubber, leather and timber just to name a few.

Organisations are starting to take note of the primary and secondary effects these wildfires will have on their supply chains.  CDP have used a questionnaire to discover how many suppliers source from the Amazon.  The data collected in 2019 showed “35% of suppliers responding to CDP’s forests questionnaire are sourcing from one or more of the 9 countries touching the Amazon rainforest.  Of these, just 18% have a commitment to ‘no land clearance by burning or clearcutting”.

Tesco one of the UK’s largest supermarkets have recently been exposed by Greenpeace for claiming their products are ‘zero deforestation’.  Whilst Tesco may not purchase meat from Brazil, much of the chicken and pork produce they sell are fed on Brazilian soya, and produced by companies owned by Amazon rainforest destroyers.

Organisations such as H&M have acted quickly to reduce the risk of leather sourced from the Amazon being included in their supply chain’s and have suspended contracts with sources from Brazil until sustainable assurances are met.

KLP is Norway’s largest pension fund who have over $80B in assets, say that they’ll “divest from transnational commodities traders operating in Brazil such as Archer Daniels Midland (ADM), Bunge and Cargill, if they work with producers who contribute to deforestation”.  KLP are also reaching out to other investors requesting they use financial influences to curb Amazon deforestation.

Vitor Gomes who’s an environmental scientist at the Federal University of Pará in Brazil stated that “According to the results of our studies, even in the best-case scenario, half of Amazonian tree species will be threatened in the future. The trends we’ve seen today could be beyond our worst-case”.

How to mitigate wildfires from your supply chain

Organisations across the world are experiencing climate related supply chain issues not just through wildfires but drought, extreme weather events, crop yield declines and water shortages. Climate change directly contributes to inequality, social disorder, crime and forced migration.

Procurement and supply chain managers need to firstly understand the direct links of their supply chains and supply networks to climate change and then devise plans to both mitigate that risk with existing suppliers (especially when alternative supply is limited) and secondly introduce new strategies and suppliers who are not harming the planet. Minimise current impact and shape future supply chains responsibly. We could even go a step further and work partners and suppliers who are seeking to have a positive impact on nature and bio-diversity as opposed to merely be compliant or a do no harm approach.

This requires mapping of supply chain risk, category strategies that include climate change impact assessments, designing requirements which incorporate climate change impact and social value as core requirements and then managing the relevant KPI’s and compliance metrics through the entire procurement cycle.

As procurement professionals we should ensure we have transparency and assurance within our supply chains with independent assessment and pro-actively address areas of environmental and social concerns, such as modern slavery, climate, environment and inequality.

This will require resourcing, expertise, training and allocating resources away from sourcing to supplier and contract management.

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The Cabinet Offices ambitious Procurement Transparency Strategy

cabinet office
cabinet office
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The Cabinet Office recently published a new policy paper entitled “Transforming Public Procurement – our transparency ambition”.  This policy paper builds upon the Green Paper: Transforming Public Procurement, the follow-up consultation and more recently the Procurement Bill.

The policy paper is broken down into six chapters, exploring how the government wants to expand upon the information it reports on to further improve their procurement transparency.

Government’s Vision

The goal of the Government is to create a transparent public procurement system that everyone from citizens to minsters, SME’s and large corporations can view, search and understand where and with whom public money is being spent.

By delivering this digital platform, the government hopes to create and open opportunities to small businesses across the UK and therefore deliver better procurement outcomes, value for money, collaboration, innovation and identify cost savings within their overarching procurement strategy.

Government’s Achievements to Date

There are number of ways in which the public sector currently provides procurement transparency.

  • Find a Tender – 1st January 2021 the UK Government launched Find a Tender where suppliers can search and apply for high value contracts, usually above £118,000.
  • Contract Finder – is used to publish opportunities over £10,000, it allows suppliers to search in different sectors, by CPV codes and region.
  • Local government bodies are required to publish details of contracts over £5,000 into a ‘contracts register’, usually found within their own website.
  • Central government departments must publish their procurement pipelines, e.g. DIO, UKAEA, Home Office.
  • Central government and NHS bodies publish transactions over £25k onto data.gov.uk or their own websites.
  • Local government and police publish transactions over £500, including payments through contracts onto data.gov.uk or their own websites.
  • Central government departments are required to report KPIs from their most important contracts on a quarterly basis.

The current landscape of Procurement

Through the above systems and change, it has allowed more transparency within public sector procurement whilst providing opportunities for SMEs.  However, with the data spread across multiple platforms, portals, and little to no information beyond the contract award stage, the Cabinet Office hopes by bringing together all this data all stakeholders involved will get a full, accurate and ultimately transparent picture of the procurement landscape.

Procurement Transparency Reforms

The Cabinet Office outlines three core procurement reforms it hopes to introduce;

  • Introduction of a number of new procurement ‘notices’, covering the entire procurement lifecycle from planning through to contract expiry. New notices have already started to be built into the Find a Tender service and the central public procurement platform.
  • Provision of a registration service for suppliers, where they can input information that will be used by all contracting authorities during procurement processes – a ‘Tell Us Once’ system
  • Digital platform which will display all this information publicly, with API access to data published to the Open Contracting Data Standard. There are plans once this is achieved to complete a core notice development and over time to build a number of useful registers and explore integrating commercial data analysis tools.

“While we are convinced of the benefits of introducing these transparency reforms, we understand that some authorities may be worried about an increased burden on their time in order to publish this information.  In order to minimise this burden, there are a number of principles that underpin the development of our policy and systems.”

  • User-centred development – Notice forms that are simple and clear, explanatory text
  • Plug directly into systems – The platform will integrate into eProcurement systems.
  • Data in, insights out – The platform will provide insights from commercial data in return, which will allow them to fully understand their markets to make better informed commercial decisions.
  • Proportional levels of transparency – Only the most detailed information – contract documents, performance markings

New & Current Procurement Notices

Below is a list of new notices that are outlined in the Procurement Bill and further details of their scope will be set out in secondary legislation

  1. Planned procurement notices
  2. Preliminary market engagement notices
  3. Tender notices and associated tender documents
  4. Dynamic market notices
  5. Transparency notices
  6. Contract award notices and assessment summaries
  7. Contract details notices and publication of contracts
  8. Procurement termination notices
  9. Payments compliance notices
  10. Contract change notices and publication of modifications
  11. Contract termination notices
  12. Pipeline notices

What about suppliers?

Suppliers will input their information about their business and answer questions that are usually frequently asked during procurements.  Contracting Authorities will be obliged to use these answers within their procurements.  This “tell-us-once” system will reduce duplicating work for suppliers ensuring bidding into the public sector is easier whilst creating a standard and updatable business record to feed information to a centralised digital platform.

The system should be able to ensure that suppliers can also easily update information, such as relevant quality certification, insurance documents or other information which needs to be updated on a regular basis.

The benefits to suppliers will hopefully finally see areas such as insurance levels become more standardised, as Government can enforce more directly previous policy guidance, so that those Contracting Authorities who are out of step with for example insurance demands will be forced to standardise their approach.

Benefits of the Reform

The transparency reforms are long overdue, many countries already have single Governmental-wide platforms, and greater transparency and in fact previously within the UK, SID4Gov and SID4Health previously had much of this capability but was not consistently implemented.

The current implementation around procurement transparency has been implemented in a piecemeal, uncoordinated manner with no strategic use of systems, data or reporting.  Each sector has different levels of transparency over areas such as spend, different levels of redaction of information, different data standards and inconsistent timeliness of publication.  Above all there has been no policing and no action taken on Contracting Authorities who are non-compliant with current policies, including the very basics such as publishing Contract Award Notices.

The impact of these reforms will be beneficial to both procurement teams and suppliers.  Reducing costs throughout the end to end procurement process and make bidding into the public sector open to businesses of all sizes by increasing visibility of tender opportunities as well as reducing administration burdens through the “tell us once” system.  However, this will all depend upon the design, execution and implementation of new systems and policies.

Cabinet Office has said that it’ll provide at least six months’ notice before a new regime comes into force.  Contracting Authorities should not underestimate the size of the task in ensuring compliance, including changes to its own internal operating guidance, policies and ensuring compliance.

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Are you contributing to Deforestation and Global Warming?

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90% of major forest, land and agriculture companies that have committed to net-zero could be at risk of missing their climate commitments due to lack of action on deforestation.  A new report by Nigel Topping a UN Climate Change High-Level Climate Champion outlines that the world can’t reach net-zero by 2050 without ending deforestation this decade.

Amazon deforestation soared by 22% in the 12 months to July according to Brazil’s space agency, whilst the WWF places the Netherlands, Germany, Italy, Spain and the UK responsible for 80% of deforestation caused by EU imports of raw materials.  As for deforestation per capita, the Netherlands had the highest rate in the EU at 18 square meters annually per person despite being one of the few nations to adopt a circular economy.

Following a consultation by the UK Department for Environment, Food & Rural Affairs the government will seek to implement due diligence provisions in the Environment Act through secondary legislation.

Governments across the world are looking at ways to halt deforestation.  Ghana and Cote d’Ivoire have agreed to create national sector-wide cocoa traceability systems as part of their sustainability alliance with the EU.  Through a system of traceability the governments are committed to connect eradicate deforestation and child labour.

In October 2021, the UK launched the Net Zero Strategy: Build Back Greener which outlines how the UK will act to achieve this, including halting deforestation.  Procurement within the public sector can be a lever for deforestation and achieving net zero.  The UK government working in collaboration with procurement teams and suppliers is critical to increase the pace for change.

Since 1st January 2021, all central government procurements are required to evaluate social value as at least 10% of the criteria used to award the contract.  Examining your own supply chain to identify risks including deforestation, modern slavery and human right violations are key to maximising ambitions to achieving net zero.

The common theme across legislation and policy across the globe is increasing awareness of critical nature of supply chains and procurement in supporting government policies to limit climate change and tackling areas of inequality and other illicit activity.  However, for procurement teams this requires far greater supply chain transparency, understanding of supply chain risks and effective planning and actions to tackle these areas.

Why Net Zero Needs Zero Deforestation Now

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Value Match are awarded the Social Value Management Certificate Level 1

social value management certificate commit 1
social value management certificate commit 1
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We’re pleased to announce that we have been awarded the Social Value Management Certificate Level 1 ‘Commit’ by Social Value UK.  Matt has led the management of this process for Value Match and has really helped us identify additional areas we could focus upon to improve our impact.

The Social Value Management Certificate Level 1 recognises our commitment to measure, manage and maximise the social value we give to our stakeholders, candidates and customers.  The Social Value Management Certificate is part of a broader accreditation offered by Social Value UK with three levels ‘Commit’, ‘Implement’ and ‘Maximise’.  Each level demonstrates at what level an organisation is at embedding social value and it’s principles.  For an organisation to achieve maximise, they must demonstrate that social value is being managed with an aim to maximise the value that is created within the organisations resources for all stakeholders and that social value data is being used within an organisational decision making continuously with processes being reviewed and processed.

Through our people, relationships, and core values; Value People, Value Relationships, Sustainable Prosperity, and Value the Environment, we place social value at the forefront of the services we offer; Resourcing, Consultancy, Training and Bid Management.

The Social Value Management Certificate Level 1 can be awarded to an organisation, department, franchise or a specific programme/project.  At the same time we were exploring how to achieve the Social Value Management Certificate, we were researching a new department at Value Match, Training and it’d be training that would be the premises for obtaining the Social Value Management Certificate.

Our initial research found that procurement training was provided by membership organisations, often with a linear developmental structure, required high investment costs for individuals or sponsoring organisations.  We found that buyers and suppliers felt they were not currently equipped to embed social value, climate, environmental and sustainability considerations into their procurement and bidding activities effectively.  This is a pivotal and key issue when taking account of social value in awarding and bidding into central government contracts.

Creating Value through Resourcing

Our resourcing team manage a network of thousands of candidates, working with each one on a regular basis to place them in permanent and interim procurement roles across the UK.  By regularly checking in and treating our candidates with respect, always providing feedback through each step of the recruitment process and obtaining feedback from both candidates and customers throughout their placements, we continuously match talent with opportunity.  Recently, Alison has been working with a candidate to place her in a large public sector organisation, working with our candidate on her CV to tailor it to the role and highlighting areas of expertise which were critical to their new position.

How we embed social value as an organisation

Reducing & Analysing our Carbon Footprint

Through working with Carbon Footprint who audit our calculations, each year we analyse and try to reduce our carbon usage.  We initially offset 12tCO2e in 2020 and have since reduced our emissions to 4 tonnes.  We’ve done this through changing our processes, finding alternatives to face-to-face meetings with online Microsoft Team calls therefore reducing our mileage.  We offset our emissions against tree planting projects in the North of England where our team reside.

Kiva

Since 2020, our team have been supporting women-owned businesses around the world through Kiva, predominately in the developing world and often with loans that support families, education, and sustainability such as lenders purchasing solar lights and biodigesters.  Our team activity has resulted in a huge impact having loaned over $17,000 across 190 loans.  Catalyzing Innovation for Women Entrepreneurs a report by Kiva highlights the importance of enabling women to access financial capital and services in general, as well as in supporting areas such as procurement and management practices.

KitAid

Lindsay, our services director is a regional volunteer for KitAid who recycles football kits and distributes to underprivileged children and adults in some of the world’s poorest countries.  820,000 items of kit have been delivered to the developing world across the KitAid network, recycling clothing whilst engaging with communities to deliver projects that vary from education, social inclusion and crime prevention.

Discover how we embed and live our values and how our team volunteer and work with other organisations to create social value and give back to local and international communities.

Contract for Change

Social Value UK relaunched the Contract for Change programme.  The programme brings together volunteers across the public and private sector to place social value at the forefront of procurement and embed it into procurement best practices.  Value Match is a strategic partner of Contract for Change supporting steering groups and other commercial activities.

Overarchingly, we place social value at the forefront of everything we do from the organisations we partner with to how we treat our customers, candidates and stakeholders and look forward to working towards our level 2 certificate.

Procurement and social value can support micro and SME businesses as inflation rates bring enterprises to ‘breaking point’.  Collaborations between pricing and procurement teams to weigh inflation’s possible effects on the prices the company charges its own customers.

We’d finally like to thank Matthew Saunders, for his hard-work and commitment in submitting the evidence and ensuring we were awarded the Social Value Management Certificate.

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Are rising costs forcing catering suppliers to pull out of contracts?

school meals
school meals
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20% increase in food, and other costs including staff and energy are placing a significant strain on catering firms working within the education sector.   It’s feared that by September catering firms will be forced to pull out of contracts before the start of the next academic year.  Catering firms have warned that school children will be served “poorer quality meals” as businesses look for affordable alternatives.

The 7p uplift in funding for Universal Infant School Meals (UIFSM) was described as “just not enough” by campaigners.  In a statement Jacquie Blake, chairman of LACA, described the increase from £2.34 to £2.41 : “Whilst all increases to funding for UIFSM are welcome, caterers are experiencing average food price increases of 20% which is likely to get worse in the coming months.  Today’s increase of 2.9% is therefore inadequate.”

The education sector is being hit hard, and headteachers have previously had to replace hot meals with sandwiches due to the cost of living crisis. This continues to underline the broader issues faced in the UK in the wake of the Global Food Crisis.

Procurement teams can support the catering provision by managing their supply chain and risk management.  Public food procurement impacts 24% of the English population and is an important leveller to promote healthy, sustainable food systems whilst 40% of catering is managed by local authorities with the remaining 20% managed in-house and 40% managed by outsourced private sector caterers.

By utilising local suppliers, procurement teams can ensure their food purchases are locally sourced and suitable route mapping is in place to reduce food milage and reduce food provenance where some wholesalers may purchase aboard.  Several questions to ask suppliers to ensure they meet this standard could include;

  1. How do you implement quality assurance systems internally and throughout each stage of the supply chain?
  2. How is quality continuously reviewed and improved?
  3. How do you evaluate your suppliers during sourcing, and post contract, manage, monitored and review?
  4. How is food quality continuously reviewed and improved?
  5. How do you work with supply chains to ensure that your products are sourced sustainably, avoiding issues such as modern slavery and deforestation?
  6. How do you provide provenance/supply chain mapping of your supply chain to demonstrate reduced carbon footprint and targets towards Net Zero?
  7. What actions are you taking to reduce your environmental impact and annual reductions in emissions of greenhouse gases?

School meals are important as for some children, it’s their only hot meal of the day.  As the UK Poverty 2022 report states: More than 1 in 5 of our population (22%) are in poverty in our country – 14.5 million people.  Of these, 8.1 million are working-age adults, 4.3 million are children and 2.1 million are pensioners

Our procurement team have recently worked with a North East based academy to deliver an outsourced catering service.  The partnership is committed to ensuring meals assist the Academy to achieve its vision of Outstanding Education as well as the outcomes of the government’s Every Child Matters initiative.  This aims to provide all children the support they need to be healthy, stay safe, enjoy, and achieve, make a positive contribution, and continue developing throughout their school years.

In addition to providing healthy, balanced meals the focus is on providing curriculum linked support and continued efforts on reducing the environmental impact of the service.  Local fresh and cooked meats are delivered by local North East wholesalers who have been selected based on a number of criteria that also included environmental and social impact to deliver the service.

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Scottish Government Circular Economy Proposal for Legislation

circular economy
circular economy climate
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The Scottish Government is consulting and seeking views on their proposal for legislation to develop Scotland’s Circular Economy.  The consultation which opened at the end of May runs until 22nd August.  The Scottish Government proposal aims to tackle the climate and biodiversity crisis and support Scotland’s transition to a zero-waste and Circular Economy.

Minister for Green Skills, Circular Economy and Biodiversity, Lorna Slater MSP is leading the consultation said “These consultations are the start of a national conversation on how we deliver these ambitions.  It requires us to be bold, brave and focused on delivering the actions needed.”

Currently, like many nations, Scotland’s is a linear economy, “take, make and dispose”.  Estimates suggest around a fifth of Scotland’s carbon footprint comes from the products and services they manufacture, use and throw away and with the average Scottish citizen consuming 18.4 tonnes of materials annually, it’s estimated three planets would be required to sustain their current usage.

This isn’t the first time a Circular Economy has been proposed to the Scottish Government.  In 2019, a proposal for legislation was published, however pressures on the Scottish Parliament due to Covid-19 pandemic, the bill was pushed back.

Scotland has already introduced and leading the UK’s first Deposit Return Scheme (DRS) which will go live on 16th August 2023.   The DRS is helping to increase recycling, decrease litter and ultimately tackle climate emergency.  The rest of the UK aren’t expected to introduce a similar scheme until 2024 at a minimum.

The Scottish Government hopes the new policies will cut waste, preserve precious and natural resources, and increase reuse and recycling rates.

The Netherlands set out a circular economy strategy in 2016, their aim is to achieve a waste-free economy by 2050.  In 2020, a study in the Netherlands found the country had reached 24.5% economy-wide circularity.  Whilst France introduced laws in 2016 ensuring unsold food was donated to charities rather than thrown away.

The public sector aren’t the only ones leading the way, private sector organisations such as Renault are repurposing and remanufacturing cars and car parts whilst our partners at Circular Computing are actively working with third-sector organisations such as the WWF to decarbonise their IT asset.

National bodies such as the BSI Group are working with Circular Computing to adopt to the Circular Economy and in October 2021 BSI introduced British Standards (BS) BS8887-220 and BS8887-211 certifies that Circular Remanufacturing Process produces products ‘equal to or better than new’.

Since 2018, ISO have been working on developing ISO/TC 323 a Circular Economy standard to develop frameworks, guidance, supporting tools and requirements for the implementation of activities of all involved to maximise contribution to the United National Sustainable Development Goals.

The circular economy has turned from an academic concept into third-sector, private and public sector target.

Scotland are leading the UK to create an environment that makes it easy for people to cut down on their waste, and the Zero Waste Scotland by 2030 plan sets out how Scotland will do this;

  • Improving recycling rates
  • Encourage reuse
  • Increasing food waste collections
  • Reduce plastic use and bring in a deposit return scheme
The plan outlines targets for 2025, 2030, 2035 and 2050, the aim of the plan is not only to get Scotland closer to zero-waste but also healthy living and sustainable economic growth.

Scotland’s Procurement Policy Note (SPPN 3/2022) set out expectations on the public sector bodies to utilise their spend to support climate and circular economy ambitions.

Public procurement in Scotland is valued at £13 billion annually and procurement will be the significant lever in changing behaviour.  The Circular Economy should be adapted by procurement professionals to influence, transform, and shape policy.

Scotland are currently leading the UK having established the National Climate and Procurement Forum to provide leadership and direction to support the climate emergency response which includes providing direction and aid the adaption of the Circular Economy.

Ellen Macarthur Foundation is a huge resource for procurement professionals and stakeholders looking at introducing the Circular Economy to their procurement strategy, they regularly publish reports, guides, and white papers around Circular Economy.  Their mission is to accelerate the transition to a Circular Economy anyone interested should register for their newsletter.

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Mitigating Supply Chain Risk Management in the Wake of the Global Food Crisis

supply chain risk management
supply chain risk management
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During May, India announced its wheat export ban after a season of exceptional hot weather affected their crop sending domestic prices soaring.  The India Commerce Minister, Piyush Goyal defended the ban by insisting that India wasn’t a major wheat exporter and therefore global markets shouldn’t be affected.  On the other hand, this export ban increased the benchmark wheat index as much as 5.9%, the highest it had been in several months.

Agriculture ministers from the G7 have criticised the decision stating “If everyone starts to impose export restrictions or to close markets, that would worsen the crisis”

More countries are banning exports of essential ingredients and supply chain risk management and food safety is a critical and growing concern in today’s environment.

Private and public sector organisations need to understand the challenges they’re actively facing and the potential solutions available to them in the wake of global food shortages.

Looking at your suppliers and analysing them from a different perspective will mitigate those risks a good starting point is to profile your current suppliers.

Reputation of your suppliers

  1. What do you know about your suppliers?
  2. Longevity of your suppliers?
  3. Are they recommended by others?
  4. Have your interactions with your suppliers been positive?
  5. Are you tracking relevant news sources in real time?

Location of your Suppliers & their Supply Chain

  1. Where are your suppliers located?
  2. Do you know the critical manufacturing or service sites?
  3. Do you know the critical locations and associated risk of your supply chain??

Criticality of your Suppliers

  1. How important are your suppliers to your business?
  2. Have you ranked your suppliers and do you relevant strategies depending upon their risk and importance?
  3. For your Tier 1 and 2 suppliers do you have alternative supply arrangements in place??
  4. In the event of a major disruption have you mapped out the implications and timescales to commission alternative supply arrangements?

What are the risks involved in your Supply Chain?

The depth and breadth of risk management will be very different depending upon your circumstances, but some areas to consider include:

Identifying your supply chain risks and understanding how to mitigate them, working with trusted suppliers and having plans in place for when your supply chain fails are fundamental requirements for all organisations.  It requires a clear understanding of your supply chain, real time data, transparency of performance and potential risks, excellent communication and most of all an environment of trust and collaboration.

Those organisations with constructive and collaborative supplier relationships will be able to manage and respond to risks faster and more effectively than those that have not invested in understanding their supply chain and built positive relationships.

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Uyghur Concentration Camps & Modern Slavery

uyghur forced labour
uyghur forced labour
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For several years there has been plenty of evidence circulating of Uyghur workers being transported to various facilities and concentration camps across the Xinjiang region.  The Uyghur people are of Turkic ethnicity, predominately Muslim, and are being transferred to “re-education” camps, systemically driving a state ideology while orchestrating forced labour.  The BBC released a huge cache of data hacked from police computer servers in the Xinjiang region.  Working with a consortium of 14 media organisations from 11 countries, the BBC has been able to authenticate significant elements of the Xinjiang police files.

The data cache reveals in detail, China’s use of “re-education” camps. The first signs of the Uyghur being detained in “re-education” was in 2016.  Since then, the United Nations have said there are credible reports of over one million Uyghurs being held in these ‘re-education’ camps in Xinjiang.  Uyghur activists stated that many have disappeared or been killed, and some have also been forced to work in factories.

Many Uyghurs who have left or been exiled from Xinjiang say they have lost all contact with their families in China.  The Chinese authorities released a statement saying the camps are “vocational training centres” and are vital to tackle religious extremism amongst the Uyghur however, there has been no credible evidence provided that these centres have had any impact on extremism or terrorism.

The Uyghurs inside the “training centres” are isolated inside a walled secure compound with security cameras and guards preventing escape.  They are not allowed to worship or cover their head and must also attend special classes in the evenings that force them to change their religious beliefs (according to former workers).

The Xinjiang Landscape and Supply Chains

Xinjiang is the gateway to the west on land from China.  It’s home to natural resources, 38% of coal reserves, 25% of petroleum and natural gas reserves compared to the rest of China.  It’s a pivotal piece of land for China.  Given the cultural differences from the Uyghur and the Chinese, it’s important for China to maintain tight control of Xinjiang and ensure Uyghur don’t seek to become separatists.

The Uyghurs look different to the ethnic majority of China, speak a different language and have different cultural views, more similar to that of neighbouring countries than compared to the rest of China and it’s because of this according to Sophie Richardson of Human Rights Watch, the Chinese central government has long regarded Uyghurs as disloyal.

Uyghur are making up one in five cotton garments.  20% of the world’s cotton comes from the Xinjiang region.  There are numerous companies profiting from this and the forced labour of the Uyghur people.  20% of the global apparel industry cotton supply is grown in the Uyghur region, the source of 84% of China’s output!

Zara as an example like almost all companies, claim to prohibit forced labour from their supply chain, yet offer no credible explanation as to how they do this.  Nike and H&M have recently faced backlash after warning of Uyghur forced labour in the cotton industry.

Sheffield Hallam University produced a report which maps the solar supply chain and evidentially demonstrates the extent of dependence on forced labour.  The report highlights

  • 11 companies engaged in forced labour transfers
  • 4 additional companies located within industrial parks that have accepted labour transfers
  • 90 Chinese and international companies whose supply chains are potentially implicated

UK Legislation and Policy Approaches

The UK Government Modern Slavery Statement explains the steps taken by the UK Government to identify, prevent and mitigate modern slavery in their operations and supply chain and how the UK Government is working with suppliers to improve their anti-slavery activity.  This follows the Modern Slavery Act 2015 which is the first piece of specific UK law to address modern slavery and is intended to provide assurance over organisational working practices to eliminate modern slavery both directly, in their supply chains and provide a defence for those forced into criminality and punishes those who commit relevant offences.

Uyghur forced labour in Xinjiang and UK value chains is a report by the House of Commons from March 2021.

‘Given the Government’s admission that the situation facing the Uyghur people in Xinjiang is harrowing and that international supply chains are likely to be complicit in the perpetuation of forced labour in the region, we are disappointed by the lack of meaningful action that has been taken in relation to these crimes.’

The UK has a comprehensive set of legal and policy obligations for private and public sector organisations to comply with, and hopefully these obligations will become more rigorous over time.  However, the broad and growing range of evidence (some of which we have shared today), United Nations reports, sector reports, various Government reports and statements show that either the legislative and policy frameworks do not go far enough, and/or they are not being adequately enforced.  Until this is resolved, all procurement and supply chain professionals should look deep into their supply chains and understand the risks they are taking by continuing support all types of modern slavery and seek to irradicate this as soon as possible.

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Introducing the Procurement Bill 2022

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£300 billion is spent through public procurement annually.  This money is spent on everything from hospital beds to office equipment to defence infrastructure.  How public money is spent is changing with the introduction of the Procurement Bill 2022.

The Procurement Bill 2022 will cut 350 EU rules as well as changing four existing sets of UK regulations that will be replaced by a single regulatory framework.  These four existing regulations include;

  • Public Contracts Regulation 2015
  • Utilities Contracts Regulation 2016
  • Concession Contracts Regulations 2016
  • Defence & Security Public Contracts Regulations 2011

The Bill sets out to simplify procurement to reduce bureaucracy and create a fairer, more open and competitive system that works better for both the buyer and supplier.

Green Paper & Transforming Public Procurement

The Bill follows on from December 2020 when the Cabinet Office set out proposals for change when they launched the Green Paper Consultation: Transforming Public Procurement.

Following the UK’s withdrawal from the EU, HM Government has the opportunity to develop, implement and design new procurement regulations that move away from complex EU rules-based approaches that were intended for the single market.  The Green Paper: Transforming Public Procurement requested feedback from stakeholders and considered comments and feedback received.

One Streamlined System

In the new system, the suppliers only have to give their core credentials once and in one place ensuring that suppliers of all sizes can bid for public sector contracts more easily.  By improving this the Government hopes to save public money whilst boosting productivity, spread opportunities, improve public services and overarchingly empower communities by taking account of social value and support the governments Net Zero by 2050 Strategy.

The Bill will provide more flexibility to procurement professionals to use negotiate and design processes that benefit suppliers whilst providing freedom to discuss procurement opportunities with suppliers earlier and throughout the process.  Discussing issues that arise and solutions that will deliver better procurement outcomes.

The implementation of the Bill is expected in 2023, once the Bill has been passed through both the House of Lords and Parliament, HM Government has said that there will be a six-month period before the Procurement Bill 2022 goes live to ensure everyone understands the legislation, build confidence amongst both buyers and suppliers and to give time to embed the changes in procurement functions.

The final draft of the Procurement Bill 2022 will most likely look different to the one published last week as there are several stages that the Bill has to pass through with additional comments and amendments likely to take place.

For now you can download the 122 page Procurement Bill 2022 PDF below.