Modern slavery and human trafficking will not be solved without a concerted effort by the private sector. Of the estimated 40 million people enslaved today, 16 million are thought to be working for companies around the world, which is why I have written to a quarter of the FTSE 100 companies calling for action in the fight against this brutal crime.
Section 54 of the UK’s Modern Slavery Act requires large companies with a turnover of £36m or more to report on what, if anything, they are doing to address slavery and trafficking in their supply chains.
Despite some encouraging, positive change since the legislation came into force, 2016’s corporate modern slavery statements were patchy in quality, with some companies failing to produce them at all and others demonstrating little meaningful engagement with the issues.
Many businesses are still failing to meet the three basic requirements stipulated in the Modern Slavery Act regarding their annual statements:
- Statements are approved by the board of directors or equivalent management body
- Statements are signed by a director
- Statements are published on the company’s website with a link to the statement provided in a prominent place on that website’s homepage.
The Business and Human Rights Resource Centre (BHRRC) recently found that a significant proportion of the FTSE 100 had failed to meet these three basic elements. FTSE 100 companies have a major influence in eradicating modern slavery. Therefore, I have written to 25 companies identified in the BHRCC research as non-compliant, and which had still not corrected their omissions by December 2017, to encourage improved efforts in the coming year.
Taking action on modern slavery and human trafficking is not just a moral obligation – it is in fact good business sense: forced labour in company operations or supply chains has potential to disrupt business, weaken investor confidence, incur litigation costs and cause significant brand damage.
With that being said, simply having anti-slavery legislation in place has already driven some positive change: research by the Ethical Trading Initiative and Hult International Business School found that one year after the Act came into force, twice as many CEOs and other senior executives had become actively involved in addressing modern slavery in global supply chains.
I commend companies which are showing leadership on tackling modern slavery. For example, Marks & Spencer has launched its interactive supply chain map for first tier suppliers, which includes whether or not there is trade union recognition at each business featured. It has also been raising awareness of slavery and trafficking with suppliers and franchisees through workshops and guidance.
Marshalls, the FTSE 250 paving specialists, have been tracing their international stone supply chains in high risk countries such as Vietnam and India and embedding slavery and trafficking awareness throughout documents and processes.
Many companies are also recognising the value of partnership working, either with charities and public bodies or with peer businesses to share knowledge. This approach has been used by Tesco to gather intelligence on emerging risks via union and charity contacts, and by Hilton which became a founding member of the UK Stop Slavery Hotel Industry Network.
And the Thomson Reuters Foundation’s ‘Stop Slavery Award’ recognises companies who identify risks of exploitation and then importantly mitigate the potential for modern slavery in their supply chain through implementation of proactive measures.
I have also been encouraged to see several companies focusing on eradicating recruitment fees and identity document retention, two key issues for protecting workers from exploitation.
The UK is taking global leadership in combating modern slavery. It is my hope that all business leaders join this fight to provide freedom and equality to the many millions currently suffering from this evil abuse. I will continue to apply scrutiny to corporate action as a key priority area and look forward to seeing improved reporting in 2018.