Originally published in the Canberra Times.

By Bruce Billson.

A good business pays its taxes, proper employee entitlements and its small business suppliers in a timely way.

Not paying is an unfair advantage over other businesses who are meeting their obligations. We hear a lot about businesses who have done the wrong thing. And they should be penalised, named and shamed.

But the majority are doing the right thing yet are unseen - and sometimes made to feel like they are lumped together with the transgressors.

It's time to honour businesses - big and small - who meet the trifecta of doing the right thing in fulfilling their workplace obligations to employees, paying their taxes and paying small business suppliers in 21 days or better.

They should be awarded a "Good Business Pays" recognition and accreditation.

The community, lawmakers and regulators rightly expect businesses to be good corporate citizens and to fulfil the many duties and obligations that come with the big responsibility of business ownership.

Payment obligations are at the forefront of expectations as failing to meet these causes economic harm to others, undermines confidence in the fairness of key systems and if not met, represents a potential competitive advantage for offending businesses.

Fair Work Ombudsman enforcement activity and widely publicised prosecutions seek to ensure employers are meeting their obligations. In its recently released annual report, the Fair Work Ombudsman said it recovered $473 million (mostly from big business) for nearly 160,000 underpaid workers in 2023-24 and took 64 cases to court.

The Tax Office is actively pursuing business "lodge and pay" duties with a more muscular enforcement posture after some years of COVID-related accommodations.

Tax Commissioner Rob Heferen recently gave a speech where he made it crystal clear that the ATO was strengthening its debt collection to meet its one central goal "to collect the taxes for the Australian government to fund the services that Australians need".

While the vast majority pay their taxes, more than $100 billion is owed to the Tax Office. Most of this debt is not in dispute. It includes money withheld from employees' wages such as tax and super or GST collected from consumers - but not yet passed on to the ATO.

The first wave of the ATO's campaign will focus on a small number of businesses who have collected (and self-reported) this tax and super but repeatedly refused to respond to Tax Office requests to engage.

I reckon businesses who have done the right thing will cheer on this step as it is unfair a recalcitrant minority should get a cash flow advantage by not remitting PAYG and GST and their employees should not be missing out on their super being paid at the right time into their retirement nest egg.

The Tax Office has identified directors of multiple companies who are doing this (and in some cases repetitively) and plans to hit them with director penalty notices which make them personally liable for these debts.

Of course, in some cases businesses have genuine reasons for falling behind on a tax bill. The ATO encourages small businesses who have trouble paying to contact them and it is often a better and cheaper option to tell the ATO if there's a problem as they have support available, including payment plans which can minimise risks and any interest charges that may be imposed.

Cash-flow problems are often a reason a small business struggles with paying tax and other entitlements as they are waiting to get paid by someone else.

Cash flow is the oxygen of enterprise and 42 per cent of the cases that come to the ASBFEO involved a payment dispute that can place an unpaid small or family business with modest cash reserves in a precarious position.

When one party is late in paying, it can cascade through the supply chain. Too often that first party that is slow to pay its suppliers is a big business or a government department.

The government and Parliament have recently moved to strengthen the up-until-now ineffective payment times reporting scheme and tools that monitor big business payment ambitions and performance toward small business suppliers.

A review by Craig Emerson aligns with what we have been saying, that the performance of many big businesses in paying small businesses has been woeful.

Many small businesses are still being forced to wait an astounding 120 days to be paid.

One of Dr Emerson's key recommendations was to "foster a culture of prompt payment" through an explicit responsibility to "publicise the worst and best payers".

We have championed this approach modelled on, and informed by, the UK's system where it has been highly effective and has made paying small business suppliers quickly part of positive corporate reputations and the environmental, social and governance (ESG) obligations of large businesses.

Reputation is what matters most to big business so we support a "name, proclaim and shame" scheme that celebrates those who support small business by paying their bills quickly and shines the spotlight on those who do not.

Meaningful and accurate information that can easily be understood and applied by small business, regulators and the community, will give big business an incentive to lift its game.

This should include a league ladder table listing the best to the worst. There could also be a list by industry sector. Public accountability is the key to driving improvements in performance.

This focus on enforcement action by regulators and reputational risk for businesses not fulfilling their payment obligations means the "deficit" lens of "non-compliance" dominates the public narrative.

But supply chain parties and public procurement process increasingly emphasising good payment practices, where a positive affirmation would assist businesses doing the right thing.

That's why we are calling for a "Good Business Pays" recognition and accreditation scheme to honour businesses which fulfil their workplace obligations to employees, meet tax reporting and payment obligations in a timely way and pay small business suppliers in under 21 days.