Supply Chain Risk Management Blog

More than words: slavery in the supply chain

It may not seem it, but the deadline for company’s statements on tackling modern slavery is deadly serious. Businesses need to be sure they know what’s happening in their supply chains.

Human rights is the number one corporate social responsibility issue in supply chains, according to a recent survey. It ranks ahead of even environmental concerns and traceability when it comes to identifying essential concerns in the coming year.

It’s hard to argue with this: Human rights are a key focus of not just consumers, but also government in attempting to crack down on abuses. And one key example is regulation to fight modern slavery.

The end of September marked the “deadline” for big organisations with a financial year ending in March to publish their modern slavery statements. In the statements – introduced by the Modern Slavery Act 2015 – organisations supplying goods or services with a global turnover of £36 million are expected to set out the steps taken to ensure modern slavery is not taking place in their business or supply chains.

A light touch

On the one hand, the requirement doesn’t seem too taxing. It is, for instance, a “soft” deadline: government guidance says only that businesses should publish their statements “as soon as reasonably practicable” after the end of each financial year, and “encourages” publication within six months – hence the end of September cut-off for those with financial years ending in March.

This is, as others have pointed out, “a light-touch approach”, and some of the initial efforts seem to reflect a failure to take the new rules seriously.

According to one analysis of the statements submitted so far, most fail to meet minimum standards the Act sets out. The majority, for instance, are not signed by a company director or are not available from the company’s website homepage – two basic requirements.

No excuse not to know: time for supply chain transparency

Nevertheless, the advent of these statements is an important milestone.

For a start, the availability of statements from hundreds of companies introduces a benchmark by which policies can be assessed. They are also likely to be pored over by campaign groups, including those focused on “strategic litigation”, bringing cases in the civil courts to penalise abuses.

Finally, more moves against slavery in the supply chain can be expected, with Theresa May recently reiterating her commitment to the issue as Prime Minister.

Given all that, statements are going to be more than just a PR tool. Some, according to the UK’s Anti-Slavery Commissioner, are likely to end up as evidence of whether companies ought to have known slavery in their supply chains was taking place – making them guilty of a criminal offence.

The statements are really just the start; businesses need to be sure they have the visibility and processes to root-out abuses in the supply chain.

As Theresa May wrote when she was Home Secretary overseeing the introduction of the Modern Slavery Act: “It is simply not acceptable for any organisation to say, in the twenty-first century, that they did not know.”

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