Shoppers walk through Oxford Street, London, Britain, December 28, 2021. REUTERS/Toby Melville/

LONDON, Feb 10 (Reuters) – British retailers have canceled 7.1 billion pounds ($9.6 billion) of contracts in the past 12 months with suppliers who fail to meet their ethical and sustainability standards, according to a report by Barclays Corporate Banking.

The report, released on Thursday, found that the COVID-19 pandemic and growing attention to environment, sustainability and governance (ESG) issues are changing business priorities.

Along with climate change, at the heart of most investors’ concerns, there are concerns about the impact of the corporate world on the nature and treatment of social actors, including workers, in often long supply chains. growing.

Barclays found that 21% of retailers surveyed had severed ties with their suppliers in the past year because they failed to meet required standards.

The most common reasons for canceling contracts with suppliers were the use of unsustainable materials, unfair working hours, and lack of membership in a professional body that monitors ethical and sustainability standards.

UK retailers are grappling with international supply chain delays which are compounded by labor shortages in domestic transport and warehousing networks.

However, Barclays also found that almost four in five retailers think a long-term strategy to improve their ethical and sustainable credentials is more important than overcoming short-term supply chain disruptions.

“We are seeing a marked acceleration and shift among retailers towards prioritizing sustainable and ethical standards in every part of their business operations,” said Karen Johnson, head of retail and wholesale at Barclays Corporate Banking.

“It is now starting to weigh on retail suppliers with billions of pounds worth of canceled contracts each year.”

Johnson added that retailers must continue to improve their ethical and sustainability standards if they are to appeal to young people.

($1 = 0.7372 pounds)

Reporting by James Davey Editing by Mark Potter

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