Supply chain compliance is currently the subject of intense public debate under the heading of "Lieferkettengesetz". Three German federal ministries are involved, some of which have different views. Germany is virtually at the centre of events here: our economic system of large corporations, small and medium-sized enterprises, strong trade unions and moderate political parties committed to the Soziale Marktwirtschaft enables a serious and "mature" discussion on the subject of minimum ethical standards in the supply chain. As a strong exporting nation, we have a great responsibility for this topic.
Nevertheless, we must be careful that Germany does not take on the role of imposing supply chain compliance requirements on other countries through national legislation. An implementation which means, for example, that tens of thousands of companies in a supply network (e.g. up to Tier-3 or Tier-4 suppliers) need to be checked for compliance is simply not possible. Furthermore, in the current tense economic situation as consequence of the Corona crisis, companies should not be burdened by additional legal requirements.
Far better than legislation at the national level, which will not be able to be enforced consistently in countries with less democratic structures, would be the establishment of a supranational Supply Chain Compliance Association (SCCA), whose stated aim is to improve working conditions at the global level.
Companies should join this association and thus make a substantial contribution by standardising control processes, providing information and obliging their suppliers to support the organisation's rules:
1. Members recognise the need to agree on binding minimum standards for working conditions for all those involved in a supply chain. This obligation is derived directly from human rights.
2. Members select direct suppliers in such a way that they meet the standards of the SCCA.
3. Members operate efficient supply chain analytics systems in order to obtain a complete picture of the supply chain and to ensure supply chain compliance.
If you would like to learn more about this topic and to find out about ways to ensure supply chain compliance in your company, please contact us at email@example.com.
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