Policies and Procedures Safeguarding Supply Chains
How Policies and Procedures Safeguard Supply Chains from Corruption and Fraud
The current global interconnected Supply Chain Departments forms the lifeblood of any organisation and is ultimately responsible for the flow of goods and services which keeps these organisations in business. The unfortunate reality is that this complex network can also be an ideal breeding ground for fraud, corruption and bribery if it is not properly managed and controlled. This is where the critical role of robust policies and procedures comes into play.
Policies and Procedures forms the backbone for transparent and accountable supply chain practises. These policies and procedures provide a clear framework for decision-making, ensuring that all actions are aligned with ethical standards, regulatory requirements and organisational goals. These frameworks include aspects such as supplier selection criteria, procurement processes, approval frameworks, contract management procedures, inventory management procedures and logistics and transportation procedures, minimising the risk of fraud, corruption, bribery, bid-rigging, unfairness and theft.
There are many consequences of non-adherence when organisations fail to enforce these policies and procedures, and this will automatically lead to an environment ripe for corruption and fraud. These consequences will include financial losses, reputational damage, regulatory penalties, operational disruptions and a culture of mistrust amongst employees, suppliers and stakeholders, which will impact on the organisations long term successes.
The only way to ensure that an organisation can curb corruption, fraud and bribery is to go beyond simply establishing policies and procedures. They need to embed a culture of compliance, where ethical behaviour is expected and rewarded, and this is a top-down approach where integrity is created through example, which will minimise the risk of corruption and fraud and will build an ethical supply chain.
