Let's get the dogs out

2017 rudi klein copy

Conduct regulators are a feature of many sectors, but not construction – what we’ve learned about Carillion’s abuse of its suppliers shows how much we need one too

Last month, the Groceries Code Adjudicator (GCA) launched an investigation into the alleged mistreatment of suppliers by the Co-op Group’s supermarket chain. The Co-op is accused of unilaterally delisting products without notification and charging suppliers “benchmarking” fees to compare the market.

If found guilty the Co-op Group could face fines of up to £71m, representing 1% of its annual turnover of £7.1bn, so it is now retraining its staff and contacting its 1,500 suppliers to find out whether they thought that their product(s) had been inappropriately delisted.

Last year, there was the threat of a formal GCA investigation into Asda, which had been accused of bullying its suppliers by demanding payments or price reductions to keep products on its shelves. Asda has since ceased the practice.

The GCA was created in 2013 to enforce an ethical code of practice between the supermarkets and their suppliers. It is funded by a levy on the 10 supermarket chains that each has an annual turnover of more than £1bn and it can act on claims of any alleged breaches from trade associations, suppliers, media etc.

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