A company is formally adhering to the principles of the UN Global Compact. After a review of their supply chain, they have found that a key supplier is in violation of the compact. The best action for the company to do first is:
A.
do nothing. The company is not responsible for compliance of suppliers.
B.
replace the supplier as soon as possible with a compliant supplier.
UN Global Compact: Companies adhering to the UN Global Compact commit to aligning their operations and strategies with ten universally accepted principles in the areas of human rights, labor, environment, and anti-corruption.
Supplier Non-Compliance: When a key supplier violates these principles, it affects the company's commitment to the Compact.
Best Initial Action:
Do Nothing: This would violate the company's commitment to the Compact.
Replace Supplier: This might be necessary later but is premature without attempting to rectify the situation.
Notify Supplier: Informing the supplier of the non-compliance is essential to give them a chance to correct the issue. This step shows a collaborative approach to compliance.
Require Compliance: Necessary but should follow the notification to provide a reasonable timeframe for compliance.
Conclusion: Notifying the supplier is the most appropriate first step, as it provides an opportunity for the supplier to address the issue and demonstrates the company’s commitment to ethical practices.
References:
United Nations Global Compact. (2020). The Ten Principles of the UN Global Compact. UN Global Compact.
Sroufe, R. (2017). Integrated Management: How Sustainability Creates Value for Any Business. Emerald Publishing.
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