Coles should repay suppliers: Colbeck

17 Dec, 2014 07:33 AM
Senator Richard Colbeck.
The confession of wrongdoing should lead to a change in behaviour
Senator Richard Colbeck.

WHILE he welcomed the announcement that Coles admitted to unconscionable conduct after proceedings brought by the Australian Competition and Consumer Commission (ACCC), Parliamentary Secretary to the Minister for Agriculture Senator Richard Colbeck expects the supermarket to take full responsibility for its actions.

Coles this week admitted to unconscionable conduct in relation to certain dealings in late 2010 and 2011 with suppliers and said it “crossed a line and regrettably treated these suppliers in a manner inconsistent with acceptable business practice.”

Senator Colbeck said the confession of wrongdoing should lead to a change in behaviour and all major supermarkets should measure and report publicly on levels of supplier satisfaction as part of their corporate social responsibility.

“Issues of unconscionable conduct were raised during the Senate select committee inquiry into Australia’s Food Processing Sector in 2011/12,” he said.

Referring to Hansard, Mr Colbeck said Coles was directly confronted by Senators about the alleged behaviour and the company stated at the time it was unaware of such behaviour happening in its business.

“The committee report recommended the major supermarkets voluntarily compile and establish benchmarks to measure the level of supplier satisfaction and engage external agencies to conduct regular supplier satisfaction surveys and publicise the results in the supermarkets’ regular reporting cycles,” Senator Colbeck said.

He said the committee investigated suppliers’ concerns regarding Coles paying discounted prices without prior discussion or negotiation.

“At the time Coles told us that all negotiations with suppliers took place in advance,” he said.

During the select committee hearing, then merchandise director for Coles John Durkan said “none of our negotiations are retrospective. They are all in advance. We have to agree with any changes to our supply price with our suppliers in advance”.

When asked what Coles would do if it was found to have acted unconscionably, Mr Durkan said: “If we had asked for money, we would repay that money”.

“I encourage Coles to uphold that promise and return money to suppliers,” Senator Colbeck said.

Office of Senator Richard ColbeckSource:
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18/12/2014 7:16:09 AM

So, Mr Durkan mislead the Senate committee. Surely, there should be sanctions for that. I don't think the ignorance defence has any credibility.


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