14 April 2016
A year on from the Modern Slavery Act: are supply chains becoming more transparent?
The Evangelical Alliance has repeatedly called for action to ensure slavery-free supply chains in the UK, including signing a letter to the Prime Minister in 2014 and joining in a coalition with other organisations including Unseen, CAFOD and War on Want, to specifically campaign on the issue. In March 2015, parliament passed the Modern Slavery Act which now requires businesses to be transparent in their supply chains.
The Bill was definitely a step in the right direction but a year on, things seemed to have lulled and the issue has become quieter. Yet for so many - the Telegraph says that there are an estimated 21 - 39 million people who are victims of modern slavery worldwide – slavery is their daily reality. A year down the line, important questions need to be considered: what is the impact of this law and how effectively is it being implemented and enforced? What are areas that still need work and were not addressed in the bill?
In the House of Lords Baroness Young asked the government how they intended to monitor companies' compliance with the new law. Lord Keen responded on behalf of the government setting out their plans including: "the requirement to place a link to a statement on their website or, if they have no website, to make it available within 30 days of a request. Organisations failing to comply with their duty will face mounting consumer and investor pressure. If an organisation fails to comply, the Secretary of State may secure a court order." He also went on to add: "the idea was that there should be far more carrot than stick, and that peer pressure should be brought to bear on companies in order that they address their responsibilities."
Section 54 of the Modern Slavery Act specifically addresses the issue of transparency in supply chains. In essence, it says that commercial organisations – those that supply goods or services – must prepare a slavery and human trafficking statement for each financial year. The statement should include a section stating which, if any, steps have been taken to ensure that slavery is not taking place within it supply chains or business. The statement must include transparency about the organisation's structure, its business and supply chain, it must assess and manage any risk of trafficking occurring and also give its policy on the matter.
Clause 7 and 8 go on to outline that if the organisation has a website it must publish the statement on the website and include the link to the statement "in a prominent place on that website's homepage". If the organisation does not have a website, it must provide a copy of the statement to anyone who makes a written request for one. If companies do not comply with such requirements, they can be taken to civil court which could result in an injunction.
After a brief search of a few big corporations' websites, including B&Q, Waitrose, Jack Wills, Nike, Apple, Primark, Morrisons, Greggs, Holland and Barret, Pret a Manger and Starbucks, quickly establishes that thorough serach is required to find anything to do with ethical or corporate responsibility and supplier information. And there is no trace of a slavery and human trafficking statement.
This would be understandable given that the 2016 fiscal year started on 6 April and that this is only the first year that a statement is required. However, a further revealed that companies like Ford, Halfords, Intel and McMullen's already have complete statements on their websites. So while perhaps they are not prominent on their websites home page, at least a statement is present, which is more than can be said of many other company websites. In fact, while the statement link may not be prominent, it is clearly labelled and can be directly accessed from a link at the foot of their home pages.
Returning to the details of the bill, the act actually states that from 1 April every business with a turnover of at least £36m must submit a slavery and human trafficking statement showing that it has taken steps to stamp out slave labour from its supply chain, and that "Organisations with a financial year ending 31 March 2016 will be the first to have to publish their statements within six months of that date" (Ethical Corporation).
The Alliance's letter to the prime minister in 2014 mentioned "This transparency measure needs to be coupled with adequate enforcement mechanisms to deliver change". Enforcement through public and media accountability makes businesses take the issue seriously, forcing senior managers to get engaged and raise awareness. The current requirements only focus on big companies leaving smaller companies below the radar with just as complex supply chains, which is something that needs to be addressed.
There is cause for celebration though: the Modern Slavery Act was passed and companies are joining organisations like Ethical Trading Initiative and Stronger Together in tackling the issue of slavery-free supply chains. The first few companies have already published their slavery and human trafficking statements which is hopefully just the beginning with many more to come.
In the coming months each of us should be looking out for these statements and be making informed decisions in response to them. And where we don't see such statements, we should ask for them.
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