66% of Businesses Prepared to Lose Suppliers With Poor CSR

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26 April 2021

Two-thirds of business leaders say they have already started replacing suppliers in the last year that don’t live up to their corporate social responsibility values.

Organisations that have inadequate policies on the environment and diversity and inclusion at greatest risk, according to new research from Sodexo.

The research shows that two-thirds (66 per cent) of business leaders say they have already started replacing suppliers in the last year that don’t live up to their diversity and inclusion values. 65 per cent said they have parted ways with supply chains that do not align with their own environmental policies over the last year.

The survey, commissioned to mark the launch of Sodexo’s Social Impact Pledge 2021, highlights the effect the COVID pandemic has had on procurement decisions, with the majority of respondents agreeing that the events of the last year had made it more important to consider environmental and diversity policies when selecting suppliers.

“It is often said that you can tell a great deal about someone by the company they keep. This is also true for businesses. It is now clear that the ability to demonstrate a positive social impact is a non-negotiable."

–Sean Haley

Regional Chair, Sodexo UK and Ireland

Social Value a Key Procurement Factor

The research shows that, while UK businesses are still placing an emphasis on factors such as cost, financial stability and cybersecurity at the procurement stage, social values are increasingly featuring in the decision-making process.

92 per cent of those polled said they now vet suppliers on their social values and impact, and 75 per cent warn they would be put off by a prospective supplier that did not publish information about their social values.

It may have been predicted that the COVID-19 crisis might have naturally led to some CSR initiatives being mothballed until a more stable time in the future. However, with the UK edging ever closer to its 2050 net-zero carbon target, and research like this indicating the importance of such a focus, Sodexo predicts that this demand will not slow down. 

Transparency in CSR Reporting

However, three-quarters (73 per cent) of the 250 UK business leaders polled agreeing or strongly agreeing that businesses often have a social value policy in place but don’t necessarily follow it. This demonstrates the importance of transparent social impact accounting – evidencing and reporting on achievements.

A strong proportion of business leaders who responded to the survey made it clear that they are prepared to offer their suppliers support to help them improve their standing and become more closely aligned with their own social values. 47 per cent said they are providing suppliers with education and training, 41 per cent are providing financial support and 39 per cent offer mentoring.

Positive Corporate Social Responsibility a "Non-Negotiable"

Sean Haley, Sodexo UK and Ireland Regional Chair, commented: “It is often said that you can tell a great deal about someone by the company they keep. This is also true for businesses. It is now clear that the ability to demonstrate a positive social impact is a non-negotiable.

“As this research clearly shows, it is a responsibility that extends beyond your own business to the organisations with which you choose to partner. While it can only be seen as a positive step that many businesses are becoming more demanding in areas such as environment and diversity, it is even more heartening to see how many are taking it upon themselves to help their suppliers do better. Business must be purpose-led and capable of directly improving the communities they serve.”

Business can search for FM and workplace management suppliers by using The Directory of Suppliers to the Facilities and Workplace Management Industry. You can discover businesses that match your requirements across a range of categories. It’s easy to search by location or service category, and more suppliers are being added every day.

Picture: a photograph of a desk that has some reporting paperwork on it, some pens and a smartphone 

Article written by Ella Tansley | Published 26 April 2021

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