Logistics companies risk UK bribery prosecution
A number of the world’s biggest logistics companies are putting themselves and their customers at risk of prosecution under UK bribery laws, according to research by business ethics consultants GoodCorporation.
Findings display that a number of big logistics groups are breaking the law by failing to publish a complete draft of anti-corruption policies. Only two in three big logistics groups have publically outlined their approach to fighting bribery, and half have made no statement on illegal ‘facilitation payments’, which are often used to speed deliveries through customs.
The logistics sector is particularly exposed to UK laws, which came into effect in July last year. These laws extend the range of parties vulnerable to prosecution.
Companies using the likes of DHL, FedEx and United Parcel Service may now be vulnerable to prosecution, so are likely to ask their logistics providers for assurances that the appropriate anti-corruption measures are in place.
“You have to do due diligence on partners, and logistics companies often don’t have the very basic documents,” explained Michael Littlechild, founder and director of GoodCorporation, in an interview with The Financial Times.
The UK has a particularly strong law in relation to corruption within companies. Companies that cannot demonstrate that they have ‘adequate procedures’ to stamp out corruption throughout their organisations could face unlimited fees and up to a ten year prison sentence, along with prosecutions to their customers. According to Littlechild, the logistical industry has not performed as fast as other sectors to respond in time to the UK laws.
“I would be astonished if you found even one of the top 30 energy companies that didn’t have a code of ethics,” said Mr Littlechild. “Logistics groups are worried about this gumming up their works and so they’re resisting putting them into place.”
Cainiao Network Launches Customer-Centric Logistics
As the logistics division of the Alibaba Group, Cainiao Smart Logistics Network has decided to provide its Southeast Asian customers with unsurpassed service during its annual shopping festival. Based on customer feedback surveys, the company will expand its real-time customer service support and speed up delivery times. ‘By expanding and deepening our services, we aim to provide a stronger logistics infrastructure that can bolster the booming eCommerce sector, support merchants’ expansion into new markets and diversify retail options for consumers’, said Chris Fan, Head of Cross-Border, Singapore, Cainiao Network.
Who Is Cainiao?
According to TIME Magazine, Cainiao ‘is far from a typical logistics firm’. The company controls an open platform that allows it to collaborate with 3,000 logistics partners and 3 million couriers. This means that merchants can choose the least expensive and most efficient shipping options, based on Cainiao’s real-time logistics analytics. The company’s goal is to ship packages anywhere in the world in under 72 hours—and for less than US$3.00.
For countless small business owners around the world, from coffee-growers to textile-weavers, this could change everything. Usually, it costs about US$100 to ship a DHL envelope from Shanghai to London in five days. Cainiao aims to change that. Said its CEO Wan Lin: ‘The biggest barrier to globalisation is logistics’.
What’s Part of the Upgrade?
Throughout the Tmall festival, Cainiao’s logistics upgrade will be divided into four critical segments:
- Real-time customer service support. Cainiao has launched a direct WhatsApp channel for customers to receive logistics updates and ask questions.
- Expansion of air freight parcel size and weight limits. Packages can now be up to 30 kilograms or 1-metre x 1.6 meters to help ship large items such as furniture.
- Daily air and sea freight connections. Shipping frequency will almost double to seven times weekly to maintain resilience and efficiency.
- Compensation for lost or damaged packages. Customers will be reimbursed up to RMB 2,000 (US$311).
Where is the Company Headed?
From June 1st to June 20th, the finale of Tmall, Cainiao will ensure that its customers feel confident in the company’s ability to deliver their packages. Despite global shipping delays due to COVID, the show will go on. Said Fan: ‘This series of customer-centric logistics upgrades reaffirms our goal of pursuing value-added services to enhance customers’ shopping experience while mitigating challenges posed by external factors’.
Furthermore, Cainiao has recently expanded its Southeast Asian operations, achieving revenue growth of 68% year-over-year. In Malaysia, the logistics operation has partnered with BEST Inc. and Yunda; in Singapore, the company has partnered with Roadbull, Park & Parcel, and the Singapore Post. And if its recent measures help retain and grow its customer base, the company will be well-poised to lead the industry in resilient and customer-centric global logistics. ‘COVID-19 made everyone realise how important the logistics infrastructure backbone is’, said Wan. ‘And it gave us a peek at what Cainiao should look like in three years’.