It is 2018 yet more than 40 million people across the globe still live in slavery. Almost 25 million of these people are victims of forced labour, according to the International Labour Organisation (ILO). While traditionally governments have been reluctant to involve themselves in the supply chains of multinational companies, the conversation around modern slavery has been getting louder.
Forced labor legislation in the US
In early 2016, US Customs and Border Protection (CBP) issued two withhold-release orders on overseas shipments, blocking the imports and preventing their release. Both shipments contained chemical processors, arriving from China, and both were suspected of being manufactured by forced labour.
The CBP’s power to stop these goods came as the US government closed a loophole in the Tariff Act. All goods made using forced labour are now forbidden from entering the country and can be seized by the CBP. Before this change to the legislation, the previous withhold-release order was issued in 2000. In the two years since its adoption, orders have been issued for goods ranging from chemical processors, to artificial sweeteners and even peeled garlic.
Due diligence efforts in the rest of the world
Faced with increasing awareness and interest in ethical production, the UK, France and Australia have also legislated in an attempt to disrupt the hugely profitable human trafficking industry. Multinationals are thus required to publish reports on due diligence and ensure forced labour is not employed in their supply chain. Failure to do so could result in the confiscation of goods, with possible criminal action and fines of up to €30 million enforced by French authorities.
The increasing pressure from West also pushed some production countries to legislate on the issue. As in Thailand, few years ago when the government publicly pledged to improve labor rights in the country’s powerful and abusive fishing industry. However according to international watch organizations the enforcement remains sometimes incomplete. It is thus necessary for multinationals to stay vigilant. Third party auditors such as Sedex have issued guidance on how to protect possible victims of human trafficking, pointing out that traditional audits rarely raise this issue.
Beyond moral duty
As Novethic mentions, it can be difficult to take the first steps, with a lack of depth being seen in the first ‘vigilance plans’ released by French multinationals this year. However, companies should need no reminder of the importance of ensuring an ethical supply chain and carry a serious and comprehensive due diligence. It is not only a moral question for businesses anymore, but also a question of avoiding the implications of falling foul of new laws. As Brian Dunch, head of supply chain risk management practice for PwC, suggests, ‘it is important that you have, whether you like it or not, accountability in your secondary [and] tertiary supply chains‘.
Written by Cameron Atkinson
