GOOD GOVERNANCE
Key suppliers can make or break company reputations and
profits , so successfully managing the governance of supplier
relationships is vital to business success
It is not just organisations that are hurt when governance processes
fail . Individual leaders can face significant reputational damage , fines
and – in some cases – the possibility of criminal sanctions .
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Not all governance risks come from direct employees . The way in
which suppliers do business can also present a risk in terms of both
public perception and legal or regulatory compliance . For instance ,
companies could fall foul of the UK Bribery Act if an “ associated
person ”, such , as a supplier bribes someone to win or keep
business . And every time a company is found to have bought from a
supplier that uses child labour to make clothes that end up in UK
shops or pick tea that is brewed in UK pots , its directors can be sure
they will face a dificult time in the press and from their shareholders .
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