A global supply chain finance programme with ESG at its heart won the Gold Award for Coca-Cola Europacific Partners at last night's Working Capital Awards ceremony in Amsterdam, sponsored by American Express. The Rabobank-run project does not include any payment terms extension for CCEP. Instead the aim is to work towards the group's target to reduce greenhouse-gas emissions across its value chain by 30 per cent by 2030.
Anthony Breach, head of procurement at Coca-Cola EuroPacific Partners, accepted the trophy in front of an audience of treasury and procurement leaders at the Amstel Hotel.
Judges were impressed with the company’s use of supply chain finance (SCF) to help encourage sustainable behaviour among its suppliers. The SCF programme works by incentivising suppliers to reduce their carbon emissions in return for more favourable financing rates.
The judging panel also recognised Coca-Cola’s efforts to make the programme as accessible as possible, with suppliers of all sizes invited to join. They also praised the soft drink producer’s decision not to link any extension in payment terms to the SCF programme.
The winning programme reflects a wider industry trend among multinational corporates to look at how they can reduce the carbon footprint across their entire value chain.
Many of this year’s award entries had a sustainability angle to them, with corporates looking at how SCF and other working capital solutions can be part of a broader strategy to reduce carbon emissions and encourage other sustainable practices among their suppliers.
Other winners and those awarded Highly Commended this year include global discount store brand Pepco who uses SCF to maintain its market position as a low-cost retailer; the Swiss chocolate producer Barry Callebaut who turned to SCF to meet certain ESG goals, and Arçelik, a Turkish household appliance manufacturer who is using SCF to help its suppliers tackle high inflation. The full list of awards is below.
Best Integrated Working Capital project
Winner: Teva Pharmacueticals
Highly Commended: Arcelik
Best use of Supply Chain Finance
Winner: Pepco Group
Highly Commended: Pick n Pay
Best ESG Working Capital Initiative
Winner: Coca-Cola Europacific Partners
Highly Commended: Barry Callebaut, Pick n Pay
Best use of Receivables Finance
Highly Commended: Krispy Kreme
Best use of Payables Finance
Highly Commended: Coca-Cola Europacific Partners, Henkel
Best Cash Forecasting Initiative
Best Working Capital Funding Solution
Winner: Pick n Pay
Highly Commended: Arçelik, Kellogg's
Best use of Technology for a Working Capital Project
Highly Commended: Arçelik, Coca-Cola Europacific Partners
Working Capital Champion: Thomas Dunn, Orbian
Working Capital Startup of the year: WeFi
Working Capital Innovation Award: Calculum
America's largest public companies, 'May have reached the limits of their ability to stretch payables terms with suppliers in mid-2022,' according to a research update from The Hackett Group. The Q2 2022 update to the Working Capital Survey suggests these companies, 'Fairly successfully navigated inventory management in the face of high levels of global uncertainty.'
The report goes on to highlight a fall in DPO of 1.1% (from 56.5 to 55.9 days) in Q2 2022, indicating a shift of leverage toward sellers.
“This is the true definition of an inflection point, and a trend that is likely to continue,” said The Hackett Group Director Shawn Townsend. “Buyers have become more concerned with supply assurance, and have had to become less prescriptive about how they receive goods and services. In addition, while supply chain financing remains popular, buyers are more focused on using it to stabilize and reinforce the supply base than to extend payment terms.”
The full report is available here