Pillage isn’t about Viking longboats anymore – you could be wearing, eating and looking at it

accapr —  15 July 2014 — Leave a comment

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By Jason Piper, technical manager – tax and business law, ACCA

I’ve spent the last few weeks making people laugh. Not intentionally you understand; in fact, I’ve been talking about something which is really rather horrible. But every time someone asks “so what have you been up to then?” I’ve told them I’m putting the finishing touches to a paper on pillage. To be fair, not everyone laughs. Quite a few people just look puzzled. After all, I’m supposed to be working on business law and tax issues; pillage sounds more like an academic historian’s territory.

But here’s the thing, it’s not. Pillage isn’t about Viking longboats any more, or even squads of cavalry sweeping over the hill, knocking down haystacks and stealing barrels of beer. Pillage these days is big business. If you’re reading this then there’s a fair chance you’re doing so at least in part using pillaged goods. You may be wearing, eating and looking at things produced as a result of pillage.

We’re living in a world of long supply chains and minutely differentiated products. Someone recently worked out there were over a million variants on one new model of car launched by GM. You can order your mobile phone in the colour of your choice, buy cheap clothes at the out-of-town mall full of chains stores you choose, and buy customised birthday cards one at a time off the internet. And behind that incredible array of choices lies a global web of trade and manufacture which almost defies comprehension. Not so long ago in Europe, it was discovered that horsemeat had been entering the human food chain, often labelled as beef. And supply chains were so long, so opaque, so poorly understood, that even the supermarkets who were supposedly at the head of them had to admit that they didn’t know what they were buying; they didn’t know what was going into their own-brand products.

Pillage is a legally defined criminal offence. It’s theft in the context of military action, and it’s a lot more common than perhaps we’d be comfortable thinking about. But it’s also hard to prove. And because there can be big money involved, there’s a very significant incentive for players further down the chain to close their eyes and close their minds to what may be going on. Minerals taken from mines in conflict zones, timber logged by warlords, cotton processed by victims of war, all can be classed as pillaged goods.

And over the last few years there have been a range of developments which have revitalised the importance of the crime. Pressure groups are looking at the jurisprudence of recent judgments and finding grounds to launch actions at corporate level. Consumers are more aware of supply chains. And theft, including handling of stolen goods, has become one of the offences which can lead to a conviction for money laundering.

So if you’re a business and there’s goods in your supply chain that might be tied up with pillage, you could be in trouble on 3 fronts – if the pressure groups can’t get a prosecution for war crimes, the authorities can come after you for financial crimes. And in either case, your PR consultants will (or at least, should be) waking in a cold sweat in the middle of the night thinking about the reputational damage that association with either event could cause – not to mention the bottom line impact of being barred from public procurement contracts.

Pillage is no laughing matter; it never has been. But now it is becoming more than ever the spectre behind the high street, a pollutive taint spreading throughout the production process of goods enjoyed around the world. If not for the sake of the victims, then at least for the sake of their own bottom line, business should be looking to do all it can to eradicate every link with pillaged goods.

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