As the UK’s Independent Anti-Slavery Commissioner, it is my role to ensure the UK is doing its utmost to eradicate modern slavery and human trafficking. The 2015 Modern Slavery Act was world-leading legislation, ensuring perpetrators can be held accountable and raising the issue up the global agenda.
The Act also paved the way for the private sector to begin looking more deeply at how modern slavery may affect it by requiring large companies to publish annual ‘transparency in supply chain’ statements (Section 54) explaining what action, if any, they are taking to understand and tackle this abuse.
Compliance with Section 54 has been patchy. Some businesses are doing impressive work on tackling slavery within their supply chains and are reporting well on this work, but many others fail to meet the requirements of the Act. Non-compliance ranges from complete failure to publish any statement to failure to adhere to the three basic requirements of Section 54. These basic requirements are:
- Statements should be approved by the board of directors – this ensures boards are seriously discussing the issues
- Statements should be signed by a director – this ensures there is clear accountability within the business on modern slavery
- Statements should be linked to the company’s homepage – this ensures other stakeholders, including investors, workers and consumers, can scrutinise business action on slavery
In January, I wrote to 25 of the FTSE 100 companies whose statements were non-compliant in 2017 based on research by the Business and Human Rights Resource Centre. FTSE 100 businesses are the biggest UK listed companies and therefore it is in the interests of us all that they adhere to the law and play their part in tackling slavery.
To date, I have received positive responses from a number of these businesses and several have amended their statements to make them compliant. However, to our knowledge, I did not receive responses from six FTSE 100 companies nor have they amended their statements based on our most recent review.
This is a serious concern and not only to me as Commissioner: institutional investors, as shareholders of FTSE 100 companies, are concerned that they are failing to adhere to the Modern Slavery Act.
As such, I have been working in partnership with Rathbone Greenbank asset management firm to gather a grouping of concerned investment firms. Today, myself and these investment firms - which have total assets under management of £817 billion - have jointly written to the six businesses which we consider did not respond to my initial contact and still have non-compliant statements. We have jointly raised their non-compliance and asked how they are taking action to ensure their businesses are free from modern slavery. The investor signatories to this letter include Rathbone Greenbank, Aviva Investors, Edentree Investment Management, CCLA, Ircantec and two further anonymous investment houses.
We hope that this joint intervention sends a strong message to UK businesses. Failure to comply with Section 54 not only demonstrates a lack of due diligence with regard to business regulation but also a failure to take this abuse of human beings seriously. Of the estimated 40 million people enslaved worldwide today, 16 million are thought to be working within the private sector. All companies, across all sectors, have exposure to modern slavery risks, whether through their subcontracted arrangements or supply chains. Therefore, we cannot solve this issue without corporations playing their part. It is imperative that those businesses still failing to implement section 54 and take meaningful action to tackle modern slavery change their practices.