Protect Your Brand
Is your brand at risk because of trading partner actions, inaction, or violations? Want to avoid seeing your company’s name in the headlines because a supplier is failing on social responsibility or any of a host of other issues?
Unsafe cars, toys contaminated by lead, pet food containing dangerous fillers, and medications formulated with treacherous levels of poor ingredients are all tragic stories. What’s common to them is that the brands of the companies affected were not damaged by their own overt acts, but by those of suppliers...suppliers that did not adhere to regulations, standards, and codes of conduct.
And it isn’t just about product safety. The US Foreign Corrupt Practices Act (FCPA) implements rules and penalties regarding the use of bribes in the conduct of business, even on the part of trading partners, and other countries aren’t far behind. In fact, the list of regulated/mandated activities and standards continues to grow. Sustainability, Corporate Social Responsibility, and Environmental regulations are also at the top of potential “headline risk” damage areas that can have a direct impact on your brand and reputation, not to mention share price.
In light of these brand risks, companies must find solutions to help their procurement, legal, compliance and finance teams easily and quickly manage their exposure to regulated/mandated compliance requirements, as well as to lower the cost of compliance. Effective solutions must provide the tools to effectively mitigate vendor risks, before they impact the bottom line, via the application of a consistent due diligence process across the extended enterprise, managing supplier policy, contact information, and compliance documentation in a single, globally available, repository. The costs may seem considerable, but the penalties in terms of brand erosion, fines, and prison sentences are much worse.
Aravo can help
Aravo has helped many companies across industries manage supplier compliance to minimize brand risk from their supply chain. For more information, please click on one of the choices in the Learn More box to the right.
"Initial press announcements containing allegations of a violation are associated with an average abnormal stock return of -1.58%. When the initial announcement indicates that the firm has been charged with, or sued for, a violation, the average abnormal stock return is -1.92%."
ENVIRONMENTAL VIOLATIONS, LEGAL PENALTIES, AND REPUTATION COSTS; Jonathan M. Karpoff, John R. Lott, Jr., and Graeme Rankine