(This blog was originally published at Bath Business and Society blog )
While research continues to inform us about the dark side of global production, the difficulties in tackling issues like forced labour and climate change remain. In this piece, Michael Bloomfield of the University of Bath’s Department of Social & Policy Sciences, and Genevieve LeBaron of Sheffield University, argue that while the UK’s Modern Slavery Act has been a promising first step in tackling forced labour in the supply chain, much more needs to be done to strengthen the Act and bring about real change.
Due to the globe-spanning nature of commodity supply chains, the multiple tiers of subcontracting that takes place within them, and the opacity of business transactions along them, global business operations have proven difficult to regulate. Various top-down approaches have been launched in an attempt to meet these challenges. Increasingly corporations have been subjected to the expectation that they should voluntarily disclose their accounts and actions throughout their operations to demonstrate that they are not directly or indirectly supporting nefarious business practices.
And governments have been increasingly interested in legislating such disclosure from companies operating within their jurisdictions, even when many of their operations take place outside of it. The UK was the first to do it. While the central focus of the 2015 UK Modern Slavery Act was strengthening government systems to detect and address modern slavery within the UK, an important clause (Section 54) seeks to address forced labour, slavery, and human trafficking within the global supply chains of UK companies.
The ‘Transparency in Supply Chains Clause’ applies to all ‘commercial organisations’ with an annual turnover of £36 million or more, requiring them to prepare a slavery and human trafficking statement for each financial year. The terms of the statement are loosely defined: company statements need to outline what steps the company has taken to ensure its supply chains are free of forced labour and slavery-like conditions. The statement must appear prominently on its website and be signed off by upper management. Although promising, there remains significant room for improvement. And the time to address these shortcomings is now. Other governments are considering similar legislation and the UK Modern Slavery Act is currently undergoing a thorough review.
We recently wrote a short article for E-International Relations on the current state of the Act with some suggestions to strengthen it. In line with the empirical evidence to date, we argue that there are two glaring shortcomings with the Act:
1) Nobody is checking whether companies are complying with the Act or not, and non-compliance carries no consequences. Civil society coalition CORE estimates that less than half of companies within the scope of the Act have published statements on the Modern Slavery Registry website. Of those published, many have been deemed to be of low quality. This is unsurprising as there are no enforcement mechanisms in place and little evidence that consumers are using them to inform their purchasing decisions.
2) The Act doesn’t require companies to report on the indicators that matter most when it comes to reducing the vulnerability of workers to forced labour in global supply chains.
Instead company statements tend to focus on their CSR commitments and the certifications they subscribe to. While such initiatives are welcome, there is little evidence either are especially effective at eradicating the most egregious forms of worker exploitation. Nor are companies reporting on the lower tiers of production where outsourcing is common and where research has shown that abuses are most likely to occur.
In our brief and open access article – The UK Modern Slavery Act: Transparency through Disclosure in Global Governance – we elaborate on the points above and, importantly, we offer a number of straightforward suggestions to increase the effectiveness of the Act in steering corporate responsibility for forced labour in supply chains.
Unless action is taken, there is a real risk that the serious exploitation of the estimated 24.9 million people experiencing forced labour will continue unabated. For them, changes cannot come soon enough.
Michael Bloomfield and Genevieve LeBaron are currently working with Andrew Crane, Director of the University of Bath’s Centre for Business, Organisations and Society , Laura Spence (Royal Holloway, University of London) and Vivek Soundararajan (University of Birmingham) on what is believed to be the first large scale academic research project exploring business relationships in the sub-tiers of global supply chains. The project has been funded by the British Academy in partnership with the UK Department for International Development as part of a major new programme on “Tackling Slavery, Human Trafficking and Child Labour in Modern Business.”