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As advocates of strong and ethical organisational cultures we have written before about the golden rule, summed up by Confucius as “Never impose on others what you would not choose for yourself.” But in some areas of business it appears that the golden rule is still a long way from standard practice.
A report by the Forum of Private Business (FPB) has revealed that late payments are still a huge issue for business. With 23% of members reporting an increase in late payments over the last year and 29% seeing an increase in the number of days a payment is late the FPB estimates that some £30 billion is tied up in late payments. This, the FPB says, forces business to seek finance to cover the gap and costs a typical small business 130 hours a year in chasing payments.
The FPB has called on the government to act to tackle this problem with suggestions such as mandatory reporting of payment terms and an annual check on Prompt Payment Code signatories. But if the problem of late payments is truly to be solved it will require organisations to change their culture and to start thinking about the impact of their actions on the wider world. Late payment is not just about money; it is also about respect and about fair business practices and about just how far businesses are from living by the golden rule.