Ensuring a supply chain is free from slave labour is a moral obligation that all procurement teams should be working towards. Furthermore, any instance of slavery within the supply chain could cause considerable damage to the buying organisation’s reputation. In an age shaped by consumer concerns over whether businesses act responsibly, procurement teams must put processes in place to mitigate this risk.
Against this backdrop, Procurement Leaders hosted a virtual roundtable to discuss ways functions are working towards gaining greater supply chain visibility and the types of preventative measures they are taking to stamp out the use of slave labour. Here are a few key takeaways from the session:
The vast majority of participants on the call were looking to avoid this risk altogether by ensuring their request for proposal and supplier onboarding processes would work to prevent any supplier using slave labour from slipping through the net.
Assessment of new suppliers is incredibly important, but you cannot expect that checking in with a supplier once at the beginning of your relationship means your supply chain is safe. A first step should be to identify and focus on high-risk areas – typically those in which labour skills are low and workers only require minimal training.
Although many functions prefer to audit suppliers regularly, this approach has its difficulties. Audits don’t always provide all the information buyers need, the auditors may not have access to payroll data and suppliers are not always keen to share areas in which they are struggling or failing.
One participant said in an attempt to cover all bases, their company uses a combination of questionnaires for Tier-1 suppliers and in-person spot-checks at high-risk factories and warehouses.
Most participants said they felt their suppliers support such efforts and noted that none of their Tier-1 suppliers had objected to any projects, codes of conduct or new auditing practices.
Companies are now incorporating sustainability key performance indicators in contracts, and updating procurement policies to specifically include sustainability and slave/child labour.
Some attendees of the call said that if any instance of slave labour was found in their supply chains then they would have to immediately sever ties with that supplier.
This is not an easy process and would likely need to include legal, financial and procurement working together, but it was considered as integral to uphold a brand’s appearance.
If procurement teams want warning of any problems, they must maintain an open dialogue with suppliers. Some participants expressed a concern that if they automatically dropped suppliers – rather than trying to work with them to solve the problem – suppliers would be less likely to be honest about any problems should they arise. Nobody wants to have heard about slavery in their supply chains on the news!
One participant explained that if they had a good relationship with the supplier at fault, they would endeavour to collaborate to remove the slave labour.
Procurement teams need to be more proactive around this risk if they want to identify and eliminate slave labour from their supply chains.
Further resources from Procurement Leaders:
This article is a piece of independent writing by a member of Procurement Leaders’ content team.