After disclosure comes action. Companies must lead the charge to eradicate modern slavery, writes Cathy Moscardini.
It’s been 9 months since commercial organisations with a turnover greater than £36 million and a presence in the UK have been required by law to report on the steps they are taking to ensure that modern slavery is not a part of their operations or supply chain. This is just the first piece in a much larger puzzle, and many are wondering how companies will follow through with tangible action.
Since we last reported on the Modern Slavery Act in May 2016, when 240 modern slavery statements had been published, we’ve seen a rise to more than 1,100 organisations publishing their statements. For many companies the initial panic is over: yes, they have published their statements for the first time, but the work doesn’t stop there. The statement has forced companies to think about modern slavery from a risk perspective, and the annual reporting nature will force companies to take further action to ensure modern slavery is not a part of their supply chains. Rankings are already being published, comparing companies’ responses to the Act. Transparency must be backed up by actions.
I recently attended the Thomson Reuters Foundation Trust Women conference, where speakers including slavery victims, NGOs, companies and entrepreneurs focused our attention on modern slavery and women’s issues. We learnt that the modern slavery industry is worth at least $150 billion a year, with an estimated 45.8 million people trapped in slavery. Of those, only 0.2% of victims get support to escape. Each year governments are spending roughly $1 billion to fight modern slavery; it is unclear how much corporates are spending. However, what is clear is that more resources are required to fight this $150 billion criminal industry.
In the session on cleaning supply chains from forced labour, we heard from a panel including Nick Grono, CEO of The Freedom Fund; Kevin Hyland, the UK’s first Independent Anti-Slavery Commissioner; Paul Lister, Director of Legal Services at Associated British Food, with responsibility for Primark’s Ethical Trade Team; Darian McBain, Global Director of Sustainable Development, Thai Union; and Caroline Meledo, Senior Corporate Responsibility Manager, Hilton. Panellists discussed practical steps that were being taken by companies to clean supply chains from forced labour.
The key takeaway was that companies should not be afraid to acknowledge and reveal details of slavery breaches in their supply chain. The uncomfortable truth is that no company can claim it is ‘slavery-free’, because as it currently stands, complete oversight of supply chains is near impossible. We highlighted in May this year how companies should approach gaining greater control of these issues beyond third party audits, but now it’s time to be clear on actions that companies can take to eradicate modern slavery from their supply chains.
Backing up your statement with action
Running a programme to tackle modern slavery may seem counter-intuitive for many companies because it could be seen as tantamount to admitting that you are complicit in modern slavery. But now that companies are required by law to acknowledge modern slavery risks in their supply chains, running a programme that addresses modern slavery will no longer single you out as a company that has something sinister to hide. Instead, it will distinguish you as a company addressing a real material and human issue.
In order to develop tailored solutions to the issues confronting them, companies must address vulnerabilities identified along their supply chain, and will often partner with suppliers, NGOs or governments to do so. There are, however, a number of other ways in which companies can take action now:
- Impact outsourcing: Once people are liberated from modern slavery, they must embark on rebuilding their lives, often in places where there is enormous stigma attached to victims of modern slavery. By employing former victims of modern slavery, companies can help to prevent individuals from being targeted again. Ethical business process outsourcing firm, DataMotivate, works with NGOs to train slavery survivors and help them find employment opportunities in outsourced services such as finance, HR, ecommerce and data services.
- Cross-industry collaboration: One challenge in addressing global issues such as modern slavery is that we often find a small handful of companies committed to solving the problem. The widespread nature of modern slavery, particularly in the developing world, means that a couple of companies addressing modern slavery on their own just won’t cut it. It must be addressed by engaging with large swathes of industry, which when working in collaboration can develop solutions and implement standards a lot more quickly. Shiva Foundation has established the Stop Slavery Hotel Industry Network, which brings hoteliers together to combat modern slavery in the hotel industry. The network will work collaboratively to develop methods to address modern slavery risks in hotel facilities and supply chains to be shared throughout the hotel sector, including a developing a stop slavery industry standard.
- Data sharing: Having the right information is the first step to taking action. But there is a distinct lack of data on modern slavery because data trails are often buried deep in supply chains, meaning that it can be difficult to find information needed to develop solutions. Accessing shared data can help companies to investigate, improve and eradicate slavery through identifying suppliers known by others to be complicit in modern slavery. Thomson Reuters has partnered with Liberty Asia to monitor and update profiles on human traffickers, which can be accessed on a global database by financial institutions to guide decision making on new and existing customers.
- Training: Modern slavery cannot be eradicated if employees that are likely to come across it are not aware of the issues. Modern slavery can cover a multitude of crimes, with different industries and functions facing greater exposure to different types of crime, making it essential to tailor training to the industry and role. For example, the hotel industry is particularly exposed to sex trafficking, and Hilton Hotels runs a training programme that is specific to each front-of-house role to help staff recognise sex trafficking in its hotels. The training gives employees the tools to spot clues for identifying potential traffickers and victims, and puts in place mechanisms for reporting incidents.
Whilst we may have a long way to go to completely eradicating modern slavery from supply chains, the UK Modern Slavery Act has pushed companies to acknowledge their role in modern slavery and raised the issue to prominence in the boardroom. As we’ve learnt from other issues, disclosure is the first step to addressing an issue: action comes next. As best practice and information-sharing grows, I hope to see more companies making faster progress to ensuring individuals become free from modern slavery.
Cathy Moscardini is a Senior Researcher at Corporate Citizenship.