Bank rejects bidders over lack of social responsibility

21 May 2003
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22 May 2003 | Robin Parker

The Co-operative Bank turned down bidders for almost a fifth of its contracts last year after checking whether suppliers were behaving in a socially responsible way.

In the first major analysis of the corporate cost of vetting suppliers and potential customers on ethical grounds to be published by a private-sector company, the bank revealed that bids for £1.7 million of the £9.5 million of contracts screened last year were "unacceptable".

The screening policy, which applies to both new and renewed contracts, uses criteria such as labour practices, animal cruelty, fossil fuel extraction and use of nuclear power.

A construction firm that had accepted a contract to build police stations for an oppressive regime, and another that had built environmentally damaging dams as part of a consortium, were ruled out of a tender process for an electrical supply contract. The bank also switched supplier on a national water cooler deal.

It has set up what it describes as its first entirely "green" branch in Manchester, which sources all of its electricity from renewable sources and uses only sustainable timber.

The bank further reveals in its fourth annual Partnership Report that by refusing to provide services to 44 customers on a range of ethical criteria - more than double as many as in 2001 - it lost £4.4 million of business in 2002.

But it believes that the positive image created by its ethical policies contributed £30 million towards its £122.5 million annual profit.

The parent company, Co-operative Group, is looking into any non-compliance of a sourcing policy it developed last year to get suppliers to honour trade union rights, hours of work and rates of pay.

However, the bank admitted that it did not hold events to raise the profile of its ethical stance with suppliers this year, as detailed in last year's report.


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