Business travel today is highly competitive, constantly being disrupted by new technologies and increasingly reaching into emerging markets around the globe. All of these factors can fuel unethical business practices, said Cees Batenburg, BCD Travel’s global chief financial officer, and Kathy Jackson, executive vice president of Global Program Management. They offer their perspective on why business ethics matters more than ever and advice on how travel buyers can protect their companies from unscrupulous suppliers.
Why should partnering with an ethical supplier matter to corporate travel programs?
CB: Companies that have ethical business policies and practices can’t fulfill them on their own. To truly operate an ethical business, your suppliers and supply chain have to operate ethically, too. In addition, requiring suppliers to operate with strong ethical practices is good for your company. It fosters fair and transparent pricing, which has important financial benefits.
Are there clear warning signs that companies should be aware of?
CB: Travel buyers and procurement managers should consider the whole picture beyond just price. If a travel management company is offering a zero transaction fee for corporate bookings, beware of hidden costs. Ask how they’re making money. That kind of an unrealistic, non-transparent business model should be a red flag.
What are some tips for conducting due diligence on prospective suppliers?
KJ: Do your homework. A company that’s serious about business ethics will have easy-to-find documentation of its business practices. At BCD, we publish on our website our Code of Conduct and our annual Sustainability report, which has an accompanying report that aligns with internationally recognized standards established by GRI [Global Reporting Initiative]. We explain in depth how we’re meeting our commitment to the United Nations Global Compact on improving human rights, labor standards, environmental protection and anti-corruption practices.
CB: Ask detailed questions about a prospective supplier’s business practices. How do they train employees on ethics? What’s their compliance auditing process? What actions do they take when there’s an ethical violation? The reality is there will be some amount of bad behavior in any organization. What’s important is how a company monitors for it and what they do when bad behavior happens. Ask for real examples of past problems and how the prospective supplier dealt with them.
Do third-party certifications matter?
KJ: Yes. Internationally recognized certifications, like ISO [International Organization for Standardization] and EcoVadis, help you understand a potential supplier’s commitment to upright business practices. The requirements are very specific, and the evaluation processes are exhaustive. So, if a supplier achieves these certifications, you can feel confident that they take sustainability and business ethics seriously.
BCD has achieved numerous ISO certifications, as outlined in our Sustainability report. We worked hard to become the first TMC to earn gold from EcoVadis, and we’re proud to have just received the sustainability rating firm’s highest ranking again—for the third year in a row. In 2017, we became the first TMC to achieve accreditation from Investors in People, a globally recognized workplace ratings firm. Plus, our client-related accounting processes are reviewed by internal and external auditors to confirm they adhere to accepted standards.
What’s driving BCD to focus on business ethics and other sustainability issues?
KJ: First, our clients take the conduct of suppliers seriously because it has an effect on how well they can meet their own sustainability goals. Many of our clients perform audits of our operations, on top of the third-party audits and certifications we’re already doing.
Second, it’s the right thing to do, and on some issues like fair labor practices and human rights, TMCs and the travelers we serve are in a unique position to drive change for the better. That’s what our partnership with ECPAT is all about.
Third, as one of the world’s largest travel management companies, we have the ability to lead on these issues, and that’s good for the whole industry.