We have built strong long-term partnerships with suppliers at all levels. This partnership approach ensures that our customers have a reliable supply of goods, and new and better products through investment and innovation. We do not encourage practices which are unsustainable such as below-cost selling. These are bad for suppliers, and are therefore bad for customers and for Tesco.
We also work with suppliers to help prepare them for legislative and subsidy changes, such as the removal of European Union production-related subsidies. An example of how we are trying to help is the Tesco-Grampian cattle initiative in Scotland. This has produced a guide for producers on cattle production methods that maximise non-subsidy returns. It advises on weight-for-age ratios, food conversion ratios, conformation grades and processing yields. We think this is a responsible way to help manage significant change in the industry at the same time as reducing costs and maintaining quality for our customers.
We aim to act reasonably and responsibly in all our commercial and trading activities. We cannot claim to have all the answers to complex ethical or social issues. However, we will do what we can to ensure that the standards of our suppliers meet relevant international requirements.
We take a risk-based approach to managing labour standards in our supply chain, in addition to the due diligence work we do on legal compliance, product safety, quality and capability for product development.
Although we are increasingly an international company, to our customers we are their local store and as such we recognise the importance of buying locally in all our businesses.