Supply chain bill to place French firms at disadvantage warns AMRAE

The bill, which was proposed by France’s socialist government and is being discussed by the country’s National Assembly, is designed to prevent accidents such as the 2013 Raza Plaza fire in Bangladesh from taking place in supply chains of French companies. The fire killed more than 1,100 people, many of whom worked at textile workshops owned by suppliers of western firms. The proposed French bill states that multinational companies based in France must ensure that their suppliers respect human rights. It also creates a similar obligation to guarantee sound environmental practices across the supply chain. Companies that fail to comply could be prosecuted by French courts and ordered to repair any damage caused.hideAnne-Marie Fournier, Vice-President of AMRAE and risk manager at luxury group Kering, said that the bill would create an extra burden of red tape and additional costs. She said French companies are aware of the risks they face in their global supply and are working hard to address them. “There is no need for a supplementary law to tell us that we have to do it,” she said. “It will require us to formalise a lot of procedures and to produce lots of justifications that will put us at a further disadvantage against other global companies.” If the bill makes it through the parliamentary process it will place France at the forefront of supply chain ethics, its supporters argue. Dominique Potier, the socialist member of parliament that sponsored that latest version of the bill, said the initiative is a ‘humanist’ effort that is set to be copied by other European countries. But business leaders have expressed concern and urged the French government to adopt a ‘soft’ stance by incentivising companies to voluntarily adopt the principles of the law. “The law should be applied at a minimum at the European level, and, ideally, at the OECD,” said Pierre Gattaz, President of MEDEF, France’s association of large companies. “It is necessary to put pressure on states and not on companies. I fear that if this bill goes ahead it will send very bad signs for entrepreneurs about the (business) attractiveness of France.” “Companies face challenges on two levels,” added Sophie Mavieux, a member of AMRAE’s board and head of risks and insurance at IT security group Gemalto. “At a very operational level, as we need to guarantee the continuity of the business, but also at the level of social and environmental responsibility, which can have an impact on reputation.” Critics of the bill also argue that French companies already have to comply with a number of international treaties on human rights and environmental protection. AMRAE board members made their comments during the association’s recent supply chain book launch. Entitled La Gestion du Risque Supply Chain dans l’Entreprise, it is the third volume of AMRAE’s Dialoguer series, which aims to help risk managers interact with other functions within their companies. The first two volumes focused on legal and IT risks. The French language, 266-page book was prepared with the support of KYU Associés, a risk management consultancy. It deals with the prevention and transfer of supply chain risks, as well as the interaction of risk managers with those responsible for ensuring smooth delivery of products and services.

Supply chain bill to place French firms at disadvantage warns AMRAE

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