UK: Competition law undermines business efforts to tackle low wages in global supply chains, acc. to Fairtrade Foundation research

Author: Fairtrade Foundation, Published on: 7 February 2019

"Competition Law and Sustainability: A study of industry attitudes towards multi-stakeholder collaboration in the UK grocery sector", 29 January 2019

...Fierce competition in the UK retail market and a perceived fear of breaking competition law is preventing businesses from fixing low wages and incomes in their supply chains. Yet the people behind goods such as tea, cocoa and bananas, which are worth £34 billion to the UK economy suffer poor living conditions and an increasingly uncertain future.

New research from the Fairtrade Foundation... shows businesses are near unanimous in the message that competition law is a barrier to taking collective action to tackle low farm-gate prices and wages. The research argues that collective action is required because businesses are afraid to act alone, due to the obstacle of first mover disadvantage.

The report, entitled “Competition Law and Sustainability: A Study of Industry Attitudes Towards Multi-Stakeholder Collaboration in the UK Grocery Sector”, investigates why, despite efforts and investment to make supply chains more sustainable, the industry has not come together to address the issue and concludes that the sector is constrained by fear.

The report has a set of key recommendations for the UK Government and calls on the Competition and Markets Authority... to issue clear guidance to private sector companies to allow them to work together to improve the incomes of farmers and workers in developing countries...

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