The Modern Slavery Act 2015: Steps to compliance
How confident are you in knowing the ins and outs of your suppliers’ working practices? Confident enough to stake your reputation on them?
How confident are you in knowing the ins and outs of your suppliers’ working practices? Confident enough to stake your reputation on them?
Move over business growth and customer relationships; if slavery isn’t on your boardroom agenda you’re not only missing a trick, but you could be falling foul of the law. The Modern Slavery Act 2015, which aims to stamp out modern slavery, forced labour and human trafficking in the supply chain, has serious implications for vast swathes of business. Around 12,000 organisations in the UK across a variety of sectors are predicted to be affected. But with change comes opportunity – the opportunity to beef up best practice among procurement partners and tick a very large customer box in the process.
There has been a “flood” of tenders for audit services from FTSE 100 firms this year, as companies prepare for new regulations to come into force.
If like the rest of the world, you’ve been keeping a close eye on the movement in the market over the past week or so, from the sudden slump, to the rapid recovery, you may have found yourself asking the same questions being asked by nervous boards the world over. Why did no-one see it coming?
For many businesses around the world, it has become suddenly apparent how close the connections between European / US and Asian economies are - with the suddenly tumultuous Chinese economy having a global impact. An impact that will no doubt continue to swing wildly over the coming weeks, even months.
MyCustomer discusses Proxima's latest research: The Digital Disconnect highlighting CEOs and CFOs are becoming increasingly concerned by the lack of business transparency regarding the commercial impact of digital marketing. From wasted investment to the risk associated with brand damage, digital has fast moved from high impact to high risk.
Quite often, we use this blog to discuss the increased reliance companies have on their global network of suppliers – the notion of corporate virtualization - and the importance of carefully managing suppliers and understanding their behavior and ethics. We have seen and written about many circumstances in which a supplier-related failure or business behavior has impacted a company’s reputation or bottom line. In many ways, company and supplier have become one, with the lines between the two increasingly blurred.
When a major, well-known and generally respected retail brand retains a supplier with a shady track record for food sourcing, it should hardly be a surprise when that supplier drags that retailer into a PR fiasco. In the recent case of a popular US retailer (which stocks everything from cleaning supplies to electronics to groceries), and Hillandale Farms of Gettysburg, the question of “the chicken and the egg” and which comes first is quite a literal one, as it relates to who gets the blame.
We are in an age where companies of all shapes and sizes turn to global suppliers more than ever before. There is perhaps no group of companies more reliant on suppliers than supermarket chains. Without suppliers, the supermarket chain is nothing more than a store with empty shelves, baskets and a neon sign.
Proxima discuss why auditing needs a check-up in April's edition of in-procurement magazine from in-tend. Looking at the current reforms and regulations, Proxima's Richard James identifies the opportunities that have arisen from this changing audit market, and how companies can use these to their advantage when tendering their audit. Find the full article on page 34.
In this Procurement Perspectives podcast, Buyer's Meeting Point's Kelly Barner discusses Proxima's latest research into consumer attitudes towards companies involved in supplier-related failures.
Growth is back on the agenda. Actually, in an increasingly lumpy economy, for many businesses it never went away, despite the vicissitudes of national and regional economies. (“Vicissitudes”? Well, the UK grew robustly in Q4 2014, then posted its slowest GDP gains for three years in Q1 2015…) And with the ongoing prevalence of risk in many markets, we’re in a period where organisations want to expand, but just don’t seem ready to invest, spend and grow in the way that macroeconomic data suggests they should.
Buyers meeting point discuss Proxima's latest research into consumer attitudes towards companies linked to supplier-related failures, and explain what this means for procurement.
NEW YORK, NY and London, UK – May 14, 2015 – A newly published survey suggests that companies who are not actively monitoring the business practices of their suppliers, or who are engaged in questionable supplier practices themselves, are placing their reputations and their balance sheets in harm’s way.
In the latest example of the extent to which a geographically far-flung supplier can negatively impact a corporation’s reputation, we present the case of McDonald’s and their Chinese french fry supplier.
Proxima's Jonathan Cooper-Bagnall submits a guest post to Procurement Leaders, explaining why in the sometimes complicated area of supplier management, a disturbing trend is emerging.
In our blog and in our ongoing dealings with clients, we continue to advocate the importance of having explicit insights and knowledge into the business practices and ethics of those companies that live within one’s supply chain. We’ve pointed quite extensively to our corporate virtualization research that reveals just how much modern organizations rely on external suppliers for the services and goods necessary to not just run a successful business, but to have one in the first place. The importance of supply chain visibility has grown exponentially in recent times, as has the potential negative impact failures can have on brand and profitability.
Every five years companies in the FTSE350 will have to rotate their auditing partner, and it is interesting for me to see how that will help drive the timing of when the remaining companies that haven’t tendered, choose to tender and who they choose to include in the tender process.
It is perhaps unsurprising that more and more FTSE350 companies will start to shake up their auditing process with the new regulations now in place by the Competition and Markets Authority. However, the tender market is still at a teenage stage. While experience is bringing greater sophistication of approach, both in how the auditors are bidding and how they are being hired; companies still have some work to do in recognising what true value looks like and how to drive maximum value from their auditors.
With new regulations requiring businesses to tender their audit more frequently this offers companies a chance to revisit a key supplier relationship; enabling them to run a tender that will encourage closer relationships, promote best practices and drive additional value.
This year is all about risk. We’re barely into February and the ruble’s collapse looks permanent, the Swiss franc has soared, oil continues its terminal decline and there’s so much conflicting data from the world’s major economies that most strategic planners’ heads are spinning. (And that’s nothing compared to the market analysts…)
Procurement Insights' Jon Hansen looks at how mandatory audit rotation will force procurement professionals to go beyond traditional boundaries.
Are companies long-term relationships with their auditors a thing of the past? The Financial Times discusses our research into the UK audit market, and why many more companies are choosing to shop around when it comes to buying audit services.
Continuing our campaign to support FTSE companies tender their statutory audit, Proxima have again been asked by the Financial Times for commentary around the topic of mandatory audit rotation.
Just one year ago the Competition and Markets Authority proposed reforms that mandate all FTSE350 companies tender their audit services every ten years; and in April 2014, this reform was also passed by the European Parliament. The new rules also require Public Interest Entities (PIEs) to change auditor every 20 years.
Proxima's Richard James discusses the virtues of mandatory audit rotation with Accounting Today and looks at how audit rotation can benefit both company and auditor in the long run.
Prior to 2011, the average tenure of a FTSE100 audit firm was almost 50 years, with the majority of firms never having changed auditors in living memory, some being retained for over a century.
As supply management evolves into a strategic business function, one of the key roles procurement teams often play is to challenge stakeholders to justify what they are paying for. In “traditional” cases this is relatively easy: you can count the number of laptops you need to buy, you can benchmark the wholesale price of utilities, you can understand the need to use a recruitment agency to find new or replacement staff.
Proxima's Richard James discusses why regulatory change has shaken up the sleepy world of audit and why this could lead to a key opportunity for companies to reassess their relationships with auditors.
Director of Finance speak to Proxima's Richard James about the new rules around statutory audit rotation; and why this could be a valuable opportunity for companies to revisit a key supplier relationship.
Following their previous coverage of our research into the UK audit market, Spend Matters discuss how procurement can get involved in the complex business of purchasing audit services, and offer advice from our expert Richard James.
Global Banking & Finance Review cover our research into the UK audit market, highlighting why the reforms by the Competition and Markets Authority are creating a challenge for procurement.
Procurement Leaders discuss Proxima's research into the UK audit market. The research highlights that although over half of the FTSE350 companies have been using the same auditor for a decade or more; proposed reforms by the Competition and Markets Authority are encouraging more firms to tender.
Spend Matters discuss our research into the UK audit market and why new reforms are forcing companies to learn more about the audit tendering process.
Proxima's Richard James talks to Supply Management about why the top UK companies are switching auditor more frequently; and why research shows that the number of companies tendering their audit looks set to rise dramatically.
The traditional way to explain the role of an auditor is that they’re a watchdog, not a bloodhound. They keep an eye on what’s happening, sit up when something looks suspicious and occasionally bark when they see something dodgy. The job is explicitly not turning over every rock they can find to test ethics or legality - no bloodhounds chasing the bad guys through the woods here.
The auditor BDO has seen larger revenues than ever before this year. The Financial Times discusses how Proxima's research into the UK audit market can explain this rise.
During the original dot-com boom, the idea of first mover advantage gained massive currency. Staking out a digital domain before anyone else showed up was considered the best way to guarantee success – gaining mindshare, customers, and above all, experience and personnel that would be denied your rivals.
There was a strong feeling of anticipation and suspense throughout the Proxima office in London on Wednesday, as we all waited excitedly for Financial Times City Correspondent Harriet Agnew’s article - discussing the shake-up to the audit tender process - to be published. A few weeks earlier, Richard James (Category Director for Professional and Financial Services) had been interviewed by Harriet, and asked to weigh in on what impact the changes to the UK audit tender process are having on the wider market.
Proxima's Guy Strafford speaks to the Financial Times around the consequences of sweeping changes to the UK audit market, and the implications that this has for both auditors and their customers.
Following new regulations and a deep desire to restore lost public faith in business, audit is making a conceptual comeback. The European Commission’s new rules on mandatory tendering for audit every ten years (along with increased scrutiny; demands for transparency in the audit process; and controls on what other work your auditor can do) make the process of choosing and contracting and auditor incredibly important.
When analysing the current FTSE 350’s use of audit services, our research highlights the impact of the Competition and Markets Authority’s reform on the UK audit market – finding that there is more happening under the surface than meets the eye...
“The fish rots from the head”. Strong words from a recent FT article rounding up a series of accounting issues besetting large companies in the UK. Following a discussion between Proxima and respected commentator Stefan Stern; Stern argues that boards need to open their eyes to all activities in their business (from top to bottom) – but without getting involved in day-to-day tinkering.
For publicly traded companies, the audit process is among the more arduous and mundane of all corporate responsibilities. Accounting today discuss Proxima's best practices guide to the audit process.
Proxima’s Guy Strafford talks to the Financial Times around the impact of procurement practices on wider corporate governance.
Spend Matters welcomes a post by Proxima's Chris Gayner summarizing the results of a recent study that portended a supply chain crisis in the UK; driven by procurement's lack of visibility into their supplier network and poor supplier relationship management.
In 1596 Shakespeare wrote the Merchant of Venice - a play in which a young Venetian merchant, named Antonio, signs an interest-free loan to help his friend, Bassanio, romantically court (with lots of money) Portia, the woman of his dreams. The catch is that if Antonio defaults on the loan, Shylock (the financier in this scenario) has the right to take a literal “pound of flesh”.
Deloitte recently published an article in the WSJ highlighting 10 Issues that are keeping CFOs up at night.
Whilst the Deloitte list highlights some of the important issues, we’ve reached out to our own network (of client teams and readers) and come up with five additional issues that are most likely to make their way to the top of the CFO’s agenda over the second half of 2014.
Alsbridge have written a whitepaper outlining why business leaders should look to managed service providers to drive out hidden treasures within their indirect spend.
We were chatting to a management thinker the other day – a former CFO, as it happens – and he said something so compelling, yet so simple, that we were stunned. “The problem with the runaway success of MBA schools is that we’re developing a global corporate monoculture,” he said. “We’re concentrating risk in similar places around the world.”