FTSE 100 firms attacked for payment code failure

Labour MP Debbie Abrahams said companies that refused to sign the Prompt Payment Code (PPC), a voluntary agreement to promote good payment practices, were showing a “lack of understanding of how unacceptable their behaviour is”, reports The Telegraph.

Ms Abrahams and several groups – including the Federation of Small Businesses, the Forum of Private Business and the Institute of Credit Management – wrote to the 75 FTSE 100 members that haven’t signed up to the PPC in July.

They were hoping to tackle the £36.4bn small and medium-sized companies are owed in outstanding bills.

While 10 more companies signed the PPC – including Serco, Vodafone and Reckitt Benckiser – 60 did not respond, four said they would not sign the code and one sent a “holding letter” that was not followed up.

Sainsbury’s, SABMiller, Rio Tinto and GKN all refused to join the code. They said they would follow their own standards, and it was the PPC they were rejecting, rather than the principal of paying on time.

However, Ms Abrahams said: “Those who responded but said, as a global company, they didn’t feel it necessary to sign up to the code… are simply demonstrating their lack of empathy for SMEs and their lack of understanding of how unacceptable their behaviour is. It’s indicative of a selfish ‘I’m all right Jack’ attitude that should not be tolerated.”

Ms Abrahams said the companies that did not respond to the letter “from the UK’s leading organisations representing SMEs should take a long, close look at the impression this gives of them”.

“The bosses of these huge multinational companies seem to be happy to give the impression that they live in another world.”
Ms Abrahams praised the 10 that signed the code for “demonstrating a commitment to help [small businesses] across the UK with prompt payments across their supply chain”.