Understanding what goes on in the lower tiers of your supply chain is now essential for business leaders and supply chain professionals, David Noble told the CIPS Annual Conference.
The group CEO of CIPS told the audience of procurement professionals at the event in London yesterday “from being a nice to do, it is becoming a must do” because of increased legislation and regulation of supply chains by governments and higher accountability of professionals.
Noble predicted next year would see the first prosecution of a company under the Modern Slavery Act. He also announced support from the UK anti-slavery commissioner and Gangmasters Licensing Authority for a self-regulatory licence for the profession.
“I will put money there will be a prosecution next year of a company with slavery in supply chains,” he said. “When that happens I can guarantee you will get a lot of attention with business leaders saying: ‘Hang on a minute, this is dangerous. I need support from someone in my organisation who knows what they are doing in their supply chains’.”
He added CIPS had received many requests from organisations asking what to do, and said the institute would be publishing guidance shortly.
“No company in the world can probably say we can guarantee we haven’t got malpractice in our supply chain, whether it is slavery or corruption. What you must do is show you have taken best endeavours to avoid it.”
He also said similar regulations were on the way in other nations. “Where the UK government starts or leads, it is often followed. And we have been talking to other governments in Australia and Africa who are saying it is coming down the tracks.”
Noble also told the audience the “survival” of the profession was dependent on redefining the value they add to the organisation.
“As you raise your head above the parapet as a profession, others will challenge it whether it is engineering, whatever function,” he said.
“I think our core functions have moved on a long way. When I talk to purchasing people in supply chains in developing countries, who are getting involved in setting up new enterprises and starting up companies it is fascinating. It is night and day from where we started out as a profession where we were cost saving. It is saying we have a role in building new industries, in diversity, in making societal differences by how we use our spend in a professional way.
“The greatest danger we have is if we don’t continue to redefine where we add value others will take that space.”