Sponsors should consider leveraging technologies and diligence practices to tackle today’s increasingly complex supply chains.
By Paul Davies, Tom Evans, David Walker, Michael Green, Hannah Berdal, and Catherine Campbell
Global supply chains have come under significant pressure in recent years, compounded by the effects of this year’s pandemic and shifting global policy agendas. In our view, supply chain analysis and management will remain critical for sponsors in the coming year as they seek to avoid risks including reputational damage, loss of revenue, and loss of goodwill. Performing diligence on a target is no longer enough — rather, the target’s value chain and broader supply chain require careful analysis to determine resilience and uncover risk areas, but such review can also identify opportunities.
On 20 April 2020, the UK government published guidance for companies on how to approach their Modern Slavery Act statements during the COVID-19 pandemic. The government has stressed that businesses should continue to identify and address risks of modern slavery in their operations and supply chains; however, businesses can delay publishing their statements by up to six months without penalty, if necessary, because of the pandemic. The government also provided recommended mitigation measures for areas of increased modern slavery risk.