Lisa Anderson was quoted on Bloomberg Law about risk to China-linked supply chains, especially geopolitical risk, prompting some companies to rethink where they source their materials or manufacture their products.
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Companies including General Electric Co., Boeing Co., and Nike Inc. are wading through a mounting pile of concerns about their China-linked supply chains as geopolitical troubles brew and pressure to cut ties ramps up from the US government and investors.
Geopolitical risk is rising as recent tensions between China and Taiwan add to companies’ long lists of supply chain worries. There’s a hangover from the Covid pandemic and shutdowns in China, tariffs on Chinese imports, sanctions on Chinese businesses, and a new US human rights law targeting forced labor in China, lawyers and supply chain experts say. And it’s all happening as the Biden administration and Congress—continually hawkish on China as an economic and national security threat—hope to incentivize manufacturing closer to home.
GE, Boeing, and automakers General Motors Co, and Ford Motor Co. are among the companies disclosing in financial filings how US-China frictions pose business risks. There’s also pressure from investors. Walt Disney Co., Apple Inc, Starbucks Corp. and Boeing faced China-related shareholder proposals in recent weeks, asking the companies to weigh the reputational risk of doing business in the country.
“There’s a mountain of risk that continues to get larger,” said Lisa Anderson, a supply chain expert at LMA Consulting.
On Capitol Hill, the newly-formed Select Committee on China sent warning shots to companies including Nike and Adidas AG earlier in May, pressing them on how they avoid using goods made with forced labor in China. The new bipartisan committee has promised to “restore supply chains and end critical economic dependencies on China.”
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Originally published on Bloomberg Law, May 16, 2023