BHP, Lundin grab Filo in $3bn South American copper deal
BHP and Lundin are creating a 50/50 JV that will own Filo del Sol, spanning the Argentina-Chile border, and the Josemaría copper project.
A lawsuit filed recently in U.S. District Court in the Northern District of California, alleges that Costco was aware that the prawns it purchased from its Southeast Asian producers came from a supply chain dependent on human trafficking and other illegal labor abuses. These claims alone are extremely damaging to Costco’s brand but coupled with potential legal action having suppliers involved in human trafficking is catastrophic for companies. The US government also recently amended the Federal Acquisitions Regulation. This amendment mandates that suppliers to the federal government have future contracts pulled and may incur criminal fines if they are caught with suppliers using human trafficked labor. There are 100 000’s of companies that will now have to comply with this regulation.
As with any regulation firms must comply but also keep costs in check. When companies have thousands or tens of thousands of suppliers how do they stay compliant while maintaining their profit margins?
Naturally … there is software for that.
Steps Companies Should Take:
Educate: Have a learning management system in place for suppliers and provide clear education around corporate policies. Track that suppliers have done training as part of their onboarding process.
Collect Data: Have a supplier management system that allows firms to collect data in the form of surveys, inspection reports, tracks supplier training and due diligence auditing.
Institute Risk Profiles: When suppliers are in high risk zones partner with an inspection provider – CSA Group / Intertek. Random inspections can be scheduled and should be part of the supplier terms and conditions. Especially for suppliers with high risk profiles, this step is critical.
Conduct Due Diligence with Audit Trail: When suppliers are in high risk areas, software can be used to conduct real time inspections with video clips and pictures taken by the inspector. This can be transferred to the supplier profile to prove due diligence along with all their surveys, education and supporting documentation
Automate: Risk profiles, data collection, inspections and due diligence can all be managed and automated through software solutions and service providers (Independent 3rd party inspection providers). The cost of maintenance is not high compared to the downside of using suppliers involved in human trafficking.
To set up an ethical sourcing program that will reduce the chances of having human trafficking in a supply chain can cost less than the cost of 1 or 2 full time equivalent employees. By using a software platform to manage the supplier education, risk profile and due diligence and by using independent third party inspectors in high risk zones companies can easily mitigate risk, ensure ethical sourcing practises and keep profit margins in check.
About Assent Compliance:
Assent Compliance provides firms with Ethical Sourcing, Inspection and Restricted Substance Compliance Automation Software. Assent works with 30% of S&P 500 manufacturers.
Link: www.AssentCompliance.com.
About The Author:
Matt Whitteker is the Communications Director at Assent Compliance. Matt is based out of Ottawa, Canada.
