After more than a year of controversy the UK’s Modern Slavery Bill is going global
In 2011, after a series of child-labour scandals on West-African cocoa farms supplying Hershey’s, Mars, Nestlé and Cadbury’s, David Cameron expressed an ambition for his country to “lead the world in eradicating modern-day slavery”. When the government unveiled its plans to introduce a pioneering anti-slavery bill in 2013, many believed Britain was making a return to the forefront of the fight against international commercial exploitation.
When the draft bill was published last December, however, it included no measures to stop UK companies using slave labour abroad. Despite protests from the bill’s evidence review panel, the joint parliamentary committee commissioned to scrutinise the draft and a coalition of 15 leading anti-slavery organisations, the Home Office concluded that asking businesses to look for slavery in their supply chains would simply be an “additional burden”.
Business leaders responded, in the report of the joint committee, arguing that supply chain legislation would “level the playing field” and ensure that companies taking action against supply chain slavery were not being undercut by ignorant or unscrupulous competitors. Drawing on statements from high-street names like Marks & Spencer, Tesco and Ikea, the committee argued that ethical supply chains were ultimately “more profitable” because “a good reputation more than pays for itself”.
Following a heart-felt abolitionist backlash, drawing on the efforts of human rights lawyers, investigative journalists, members of the public and MPs on all sides, the Home Office finally issued a statement last week, announcing that the legislation would be amended to stipulate that “big businesses will have to publicly state each year what action they have taken to ensure their supply chains are slavery free.”
“We are delighted to hear the news from Karen Bradley MP [Minister for Modern Slavery and Organised Crime in the Home Office] regarding the measure to re-introduce supply chain reporting,” said David Noble, CEO of the Chartered Institute of Purchasing and Supply (CIPS). “The importance and value of good management of supply chains cannot be underestimated in these discussions and the profession has a huge role to play.”
He was right to be relieved. Earlier this year, research carried out by the CIPS revealed that consumers and business leaders in Britain had long relied on a strict “don’t ask, don’t tell” policy with regard to international supply chains. According to a survey of 3,406 respondents, almost three quarters (72%) of British supply chain professionals had no visibility of their supply chains beyond the second tier. More than one in ten (11%) of UK business leaders said modern slavery in their supply chains was “likely”.
The government undoubtedly felt additional pressure to act from the increased press attention given to modern-day slavery since the Rana Plaza factory disaster in April last year. Most notably, the Guardian’s exposé of the Thai prawn-fishing industry, which revealed kidnapping, corporal punishment and summary execution at the bottom of supply chains that led to high-street names like Tesco, Aldi, Morrisons and the Co-operative.
The announcement marks a welcome departure from the government line that a “human rights reporting” mandate added to the Companies Act in 2013 would be sufficient to legislate against slavery in supply chains. The existing measure was proven inadequate, as it prescribed neither a duty to audit for slavery nor a duty to audit supply chains specifically.
“This is not simply about forcing companies to act, but helping them to act,” said opposition front-bencher Diana Johnson at the Bill’s final committee hearing in the Commons. “This legislation is about changing market conditions and creating market incentives for the suppliers themselves to be shown to be fair. It would mean suppliers being able to show that they are meeting International Labour Organisation standards, backed up by kite-marking and an inspection regime.”
The government intends to produce statutory guidance to accompany the provision, setting out the kinds of information that might be included in a disclosure, so that companies understand how to comply. However debates over the size of the companies to which the clause will apply appear to be ongoing. “Our initial thinking is that this will apply to larger companies,” Karen Bradley indicated on Tuesday last week. “However, we want to get the threshold right.”
A similar provision in Californian state legislation is based on company turnover. Since 2012, companies doing business in California, with annual worldwide gross receipts of more than $100 million, have been required to disclose publically their efforts to eradicate modern slavery and human trafficking from their supply chains.
Apple, whose reputation suffered after a spate of workforce suicides at its China-based supplier in 2010, has since come under pressure from the Californian legislation to conduct 288 international audits. Finding that only 38 percent of its suppliers adhered to its recommended 60-hour working week, Apple has vowed to tackle labour abuses wherever they occur in its supply chain.
However, the UK government has promised to surpass the Californian example. Last week’s Home Office press release boasts a measure that “goes further than any similar legislation in the world” by applying to businesses regardless of the nature of a company or what it supplies. “Because we have had the benefit of California’s experience,” Karen Bradley confirmed, “this will not be limited to businesses that provide goods for sale, so that companies providing services also will be caught by the disclosure obligation.”
The decision also represents a considerable turnaround from the argument put forward, in a Home Office ‘factsheet’ on the 29th of August, that UK supply chain legislation was unnecessary, because an EU corporate reporting directive, set to come into force in 2016, may have a similar effect.
To this extent, Britain appears to be returning to its time-honoured position as a trendsetter in international abolitionism. Although the auditing duty will likely only fall on larger UK corporations, it will be the smaller, less risk-averse companies that Britain does business with all over the world that are forced to clean up their acts accordingly.
The measure is also expected to incite positive competition between the companies affected. “Once it is clear to see what activity major businesses are undertaking,” Karen Bradley said in a letter to the chairmen of the Bill Committee last week “public pressure and competition between businesses will encourage others who have not taken decisive steps to do so.”
Whatever details crystallise out of the flow of rhetoric, between now and the end of the parliamentary session, the stage is undoubtedly set for Britain to return to its role as a world-leader in the war on slavery. Whatever difficult truths emerge when the reporting requirements come into force, the will to act on them has never been stronger.
Michael Pollitt works as a researcher in the House of Commons. He tweets @MJPollitt
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