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Stamping out slavery in the supply chain

RiskEuropeCorporate social responsibilityEthicsCSR PoliciesGovernance and Legal ComplianceReputational RiskBlog+-
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When the draft bill of the UK Modern Slavery Act was amended to include a supply chain clause stipulating that businesses with a turnover of over £36m would be "forced to make public [their] efforts to stop the use of slave labour by suppliers”, it was celebrated as a huge leap forward for ethical business practice.

 

For the first time ever, big businesses would be required to report on slavery and human trafficking in their supply chains as part of their annual company statements.

 

Following the passing of the legislation into law, the UK’s prime minister, Theresa May, pledged an additional £33m worth of investment into tackling people-trafficking as well as a dedicated taskforce, which will include involvement from the UK’s security agencies - MI5, MI6 and GCHQ - and will go after perpetrators.

 

 

It is a start, but there is still some way for businesses to go before the issue is solved completely.

 

According to a recent study by the British Institute of International & Comparative Law (BIICL) and Norton Rose Fulbright, just over half (51%) of 152 major companies surveyed had performed a dedicated human rights due diligence assessment, which covered the full range of a company’s human rights obligations.

“Although significant changes to national and EU laws have made the human rights performance of companies an increasingly important corporate issue, our report has found that half of companies don’t even have a dedicated human rights due diligence process, and as a result, they are failing to pick up adverse human rights impacts in their business, and with third parties, such as suppliers," said Professor Robert McCorquodale, director of BIICL.

Although the Modern Slavery Act stipulates that businesses publish a ‘slavery and human trafficking statement’ for each financial year, it doesn’t actually include any financial penalties for those that do not comply.

 

Some argue that it therefore doesn’t have enough teeth to force though change. The legislation does however include power for the secretary of state at the Home Office to seek an injunction to force a disclosure. The government hopes though that stakeholder and consumer pressure will be enough to push more businesses to produce a statement.

 

Despite this though instances of slavery continue to be found.

 

In December 2016, a year after the legislation’s introduction, prime minister Theresa May said that there there had been 289 modern slavery offences prosecuted in the UK in 2015 - and a 40% rise in the number of victims identified.

 

The more businesses can do to find out what is happening in the supply chain, the more likely it is that slavery will be stamped out.

 

The risk of doing nothing is high both in terms of damage it can do to a brand as well as to those whose lives are ruined by this issue.

 

It is time to stamp slavery out and with procurement leading the efforts to assess the supply chain, it is achievable.

 

 

This article is a piece of independent writing by a member of Procurement Leaders’ content team.

Rachel Sharp
Posted by Rachel Sharp

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