We live in a Volatile, Uncertain, Complex, and Ambiguous (VUCA) world, and human rights and labour practices in supply chains are a formidable example of this VUCA landscape. With increasing pressure from civil society for ethical management, and associated media coverage of corporate supply chains, transparency is increasing.
According to the International Labour Organization (ILO) at least 21 million men, women and children around the world are in some form of slavery. Whilst many affected are found in Asia, there are also problems closer to home in Europe. Indeed, in the UK alone, it is estimated that 10-13,000 people are in modern slavery at any time. Of course, concerns of slavery should also be considered in supply chains and operations in other parts of the world - and only recently 2 major UK companies have been accused of improper labour practice in Qatar. The UK’s response to these themes and issues has been to deliver the Modern Slavery Act 2015.
What follows are three examples of what new forms of corporate transparency (requirements) look like
UK Modern Slavery Act
On the 1st April, Section 54 of the Modern Slavery Act came into force, requiring businesses with an annual turnover of £36 million or more to publish annual statements indicating what their company is doing to ensure their supply chains are slavery free. It effectively requires companies to take responsibility for the entirety of their supply chains, demonstrate commitment to finding out whether there is forced labour in their business activity, and ensuring it does not occur.
Early research however indicates that only 22 of the 75 UK slavery act statements reviewed fulfil criteria to be signed by the board of directors and the link to the disclosure displayed prominently on the company's website (i.e. through a link on the company homepage).
While the measures in the Act are not directly punitive, it is hoped that as time progresses, it will drive up standards in labour markets and supply chains in the UK and internationally.
This continuing drive for corporate transparency in supply chains shows no sign of letting up. Indeed, only recently in March, legislation passed by congress in the US closes a loophole and bars all imports of products that use forced or indentured labour. Other legislation and frameworks internationally also include:
Whilst the UK may have arguably taken a lead on producing a specific piece of legislation to tackle modern slavery – the agenda has also been brought to the international stage. Specifically, slavery in supply chains has now also been enshrined as a target under Sustainable Development Goal (SDG) 8: Decent work and economic growth. SDG8.7 cites:
“Take immediate and effective measures to eradicate forced labour, end modern slavery and human trafficking and secure the prohibition and elimination of the worst forms of child labour, including recruitment and use of child soldiers, and by 2025 end child labour in all its forms”
Transparency in corporate human rights is also being furthered through new benchmarks, which have been piloted and each seek to expand reach and benchmark sectors before the close of this year, including:
Whilst it has been over a year since we remarked on corporate human rights and the creation of this benchmarking, our closing message remains the same “As human rights continues to rise on the agenda, more companies would be wise to consider their own impacts”. We have only provided a taster of corporate considerations on this theme, the important point is to start the journey and understand your supply chains and associated risk.
For note: While civil society organisations petitioned for the UK Slavery Act to include a register of company statements for better informed transparency, this was omitted from the final legislation. Despite this, an informal database of published statements is available and logged on the Business & Human Rights Resource Centre, here.
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