I’m reacting, of course, to the glib idea that larger companies can insist their suppliers meet ESG criteria – or lose their business.
Sounds great doesn’t it?
Surely we should be soooo grateful to those kind corporates who are saving the planet, not only by improving their own sustainability footprint, but also creating eco-friendly supply chains through their weight of influence.
Like most things that sound too good to be true, this IS.
Reality check #1: Can we please remember that successive governments (globally – not just in the UK) have been promising to sort out the late payment crisis, but have singularly failed to do so. Many big companies persistently pay their (small) suppliers late.
Reality check #2: Large companies hold all the power in commercial relationships and frequently screw their (smaller) suppliers to the ground on margins. So SMEs often have very little financial wiggle room.
Reality check #3: So now you’re telling me that large companies should simply demand that their (often smaller) suppliers go to the expense of ESG certification and complex measurements. Or they lose the business. Really?
Can someone tell me where the money’s coming from?
SME’s are screwed to the ground on margins; they are often paid late; and someone now thinks it’s clever that they should be made to take on a load of extra ESG reporting costs.
Are the large companies offering to share the burden?
Are the large companies offering any form of support?
Are the large companies offering incentives (other than negative ones)?
They jolly well are not! (they may be a few exceptions, but I’m talking about the generality).
So let’s hear a bit more from large companies, governments, trade associations, policymakers etc, about how corporates should be supporting their SME suppliers to monitor and report emissions data. Let’s have some rules for the corporate about what they must do to help things improve.
We hear a great deal about equity in the workplace.
How about extending this concept to large companies and their smaller suppliers.
Little firms want to become greener.
But they do not want to be crudely bullied.
