Our campaign with Xero put the late payment crisis at the top of the business policy agenda.
The new government confirmed in September 2024 that it will legislate to compel companies to publicly declare in their annual reports how much of small businesses’ money they are holding onto in late payments. This is a step Xero pioneered, and has consistently campaigned for.
Adam Keal, UK & EMEA communications director, said: “Fourteen Forty has helped us break new ground with a campaign which has affected livelihoods and mental health, for years. They look at things in the round, at the horizon, and from the shoes of the audience. They focus on tangible outcomes with impact, not just outputs.”
Xero uses its influence to support the smallest businesses that aren’t able to make their voices heard. Our campaign helps them to
1/ Give a voice to small businesses
2/ Expose and change a big business culture which normalises holding back money owed to small suppliers
3/ Make late payments an issue of corporate reputation and political debate, and to level the playing field for UK small businesses
Challenge
Late payments pose a severe threat to small businesses, leading to cash flow issues, closures, productivity losses, and mental health struggles for business owners. In 2023, late payments cost small businesses £1.6bn.
Despite this, late payments are often excused as standard business practice, with small businesses having little leverage to push for change.
Xero set out to shift this narrative by building a coalition of support to bring about long-term change.
Approach
To challenge the late payment culture, we implemented a four-pronged strategy:
- Creating visibility and accountability: by ensuring that business directors, employees, customers and stakeholders are aware of existing practices:
- Highlighting the seriousness of the problem and arguing late payments should be called “unapproved debt” making it clear it’s not a legitimate aspect of cashflow management.
- Forcing companies to declare in their annual reports how much “unapproved debt” they hold at the expense of their small-business suppliers
- It’s also a critical reputational environmental, social and governance (ESG) issue: good businesses wouldn’t dream of paying their employees late, so why do they think it’s OK not to treat their supply chains with the same respect?
- Building evidence: we produced a raft of research, white papers, and reports, which track the real-world impact of late payments.
- Lifecycle of an invoice
- Tackling unapproved debt: six recommendations for dealing with the late payments crisis
- Small business. Big opportunity: levelling the playing field for small business growth
- Late payments: the missing piece of ESG measurement
- Putting late payment on the great workplace agenda: redefining “great workplaces” by how they treat their suppliers
- Settle up: shining a light on the late payment scandal
- Building a coalition of support: developing relationships with policymakers, conducting consultations, and participating in reviews.
- We engaged third-party organisations and used media and customer communications to spread the message
- Direct engagement with government and stakeholders: we launched the “Manifesto for Small Business Success” at the House of Commons, which brought together MPs, small business organisations, public policy influencers, customers and accountants.
- The campaign was amplified through out of home advertising at Westminster targeting policymakers directly.
Results
Our campaign has successfully changed government policy. Late payments are now an issue of corporate reporting and reputation in a way they never have been before.
The new government has committed to ensure big businesses explain themselves in their annual reports, as well as a review of prompt payment regulations and making late payment performance an ESG measure.
