Written by Laura Haworth
Far from being rare, slave labour is an ever increasing phenomenon around the world, affecting at least 21 million people and generating profits that amount to US$ 150 billion per year. Although slavery is illegal in all countries, and many of them have designed progressive laws to protect the rights of workers: the expansion of global business, the need for continual profits and the lack of enforceable international law has led to the use of slave labour along different stages of the supply chain by businesses of all sizes and in all locations.
Things are, however, starting to change. The need for ethical trade is slowly gaining relevance among international organisations, NGOs, states, and consumers, and therefore also for businesses. The pressure that is being exercised by these stakeholders calls for action has lead the UK to take an important first step in combatting slavery.
The Modern Slavery Act
Passed in 2015, the UK Modern Slavery Act (MSA) is the first of its kind in Europe and one of the first worldwide. It aims to tackle slavery by putting the focus on businesses and their supply chains, and more importantly, transparency.
It addresses both support for victims, and punishments for perpetrators of human trafficking whilst also providing a strategy for businesses to manage modern slavery internally and within their supply chains. The MSA Transparency in Supply Chain Provisions require companies with a turnover of £36 million or more to publish a statement annually confirming their actions to ensure that there is no use of slavery or trafficking in the business, or declaring that no steps have been taken in this direction.
The statement must be approved by board level and published in the company’s website, or available to consumers upon request, and it is advised that it includes:
- Information on organisational structure
- Due diligence processes
- Risk mitigation procedures
- Effectiveness of initiatives
- Staff training
To comply or not to comply
CLT envirolaw has carried out some research on how businesses are responding to the Modern Slavery Act and implementing its requirements. The results were far from satisfying, showing that 14% of respondents had not heard of the Act, or were unsure of its existence, and 61% of companies had either not produced a statement or were unable to clarify if they had one in place. Of the 20 companies that had published a statement, none of them met the legal requirements of the Act as the statements were either not featured on the home page of their website or the statements had not been approved by the board of directors.
The lack of implementation of the basic requirements of the Act was echoed in their lack of action regarding supply chain management, with three out of four companies not ensuring due diligence in this area.
The introduction of the Modern Slavery Act is an important milestone, and evidences a commitment from the state to fight slave labour and human trafficking. It is now imperative for governments to strengthen and enforce legislation that leads companies to make the necessary changes not only internally, but within the supply chain. Businesses, on the other hand, will need to understand and create awareness on the importance of ethical trade and its positive impacts, and take steps to comply with formal requirements and legislation.
To download the results of the research, click here.