The Modern Slavery Act was launched with a fanfare of publicity, promising tough sentences – up to life imprisonment – for convicted people traffickers.
A lesser-known provision requires businesses with a turnover above £36m to publish a statement showing the steps they are taking to tackle slavery and human trafficking in the business and its supply chain or, alternatively, declare they have taken no such steps.
So while businesses can comply with the Act by publishing a statement that they have done nothing, the Government hopes that the risk of adverse publicity will push companies to take a pro-active approach.
Rob Johnston, Chief Executive of Cumbria Chamber of Commerce, said: “There are no financial or criminal penalties for businesses that fail to comply with the disclosure obligation, although the Government can ask the High Court for an injunction requiring a business to comply.
Most business people would be horrified to discover that they were sourcing products that relied on exploitation or slave labour.
“But it’s good practice for any business, regardless of size, to pose the question, ‘Do we know what’s going on in our supply chain?’.
“Most business people would be horrified to discover that they were sourcing products that relied on exploitation or slave labour.
“And in addition to the moral arguments, there is a danger of serious reputational damage to your business if abuses come to light – and I’m not just talking about slavery and human trafficking.
“Clothing retailers such as Primark and Matalan suffered huge negative publicity when it emerged they had sourced from the Rana Plaza garment factory in Bangladesh, which collapsed in 2013 killing 1,135 people.
“Primark subsequently paid out $14m in aid and compensation. In hindsight, I’m sure they regret not paying more attention to their supply chain.”
He added: “Another consideration is that major public and private sector procurers may insist in their procurement criteria that would-be suppliers have a modern slavery and human trafficking policy.”
The Act defines “slavery” as the exercise of ownership over a person where they are coerced into providing their services or do so under threat of a penalty. “Human trafficking” covers arranging or facilitating the travel of individuals with a view to exploiting them.
The sectors most likely to be affected are construction, agriculture, textiles, security, food processing and packaging, and hospitality and tourism.
Section 54 of the Act sets requires businesses with a turnover above £36m to prepare a slavery and human trafficking statement for each financial year.
The statement may include information about:
- The organisation’s structure, its business and supply chain;
- Policies in relation to slavery and human trafficking;
- Due diligence processes in relation to slavery and human trafficking in the business and its supply chain;
- The parts of its business and supply chain where there is a risk of slavery and human trafficking taking place, and the steps taken to assess and manage that risk;
- Its effectiveness in ensuring that slavery and human trafficking is not taking place in its business or supply chain, measured against such performance indicators as it considers appropriate;
- The training about slavery and human trafficking available to staff.
The statement must be approved by the board and signed by a director.
And the business must publish it on its website, including a link in a “prominent place” on the homepage.
The HR web site Personnel Today has a useful template for businesses looking to compile modern slavery and human trafficking statement.
Cumbria Chamber of Commerce’s Growth Hub service can offer help to businesses in developing and monitoring your supply chain.
- Free access to our team of professional advisers;
- Access to sources of funding;
- Training courses to help with every aspect of your supply chain journey;
- Networking opportunities to help you connect with the right people;
- Information in a variety of formats including webinars, videos, podcasts, factsheets and case studies;
- Dedicated online forums to share and exchange ideas.
- An online business directory to help you find other businesses and promote your profile, interactive tools to help you engage with your audience, and an events diary so you do not miss out on opportunities.
For more information click here or call 0845 226 0040.© Cumbria Chamber of Commerce