February 4, 2021
Modern slavery is a violation of human rights that frequently occurs in supply chains and disproportionally affects millions of workers who are poor, vulnerable and low skilled. Driven by fierce competition and global demand for cheap labor, this exploitation of labor is often hidden within dispersed supply chains, spanning producers, manufacturers, distributors and retailers. Production and distribution interruptions resulting from the COVID-19 pandemic only exacerbate the problem.
Implementing modern slavery in supply chains training is one of the key measures to minimize the risks of modern slavery and human trafficking and ensure an ethical, safe and healthy work environment for all employees.
What is modern slavery in supply chains?
Anti-Slavery International defines modern slavery as the severe exploitation of other people for personal or commercial gain. Modern slavery practices include:
- Forced labor, where a person is forced to work against their will or under the threat of punishment
- Bonded labor, where a person cannot leave because they are bonded or indebted
- Indentured labor, where agencies or brokers put people into debt with no other way to pay it off but to continue to work
- Child labor, where children are exploited for the gain of adults who are not family members
Modern slavery can exist within any stage of a supply chain – from raw materials to manufactured goods to shipping and delivery. Suppliers are incentivized to keep labor costs low and often exploit workers as cheap labor to squeeze out profits. However, often complex global supply chains make it difficult to know if and where labor exploitation may be occurring. When left unchecked, both consumers and organizations end up inadvertently contributing to the problem by purchasing goods made with exploited labor.
The economic impact of the COVID-19 pandemic on supply chains only compounds the issue of modern slavery. The Global Business Coalition Against Human Trafficking states that canceled or delayed purchase orders can result in supply chain workers losing their livelihoods and accepting precarious work. It adds that when global economies recover from the pandemic, the rush to fill supply chain orders may further drive exploitation.
5 practices to help keep modern slavery out of supply chains
- Train employees and managers
Train staff in procurement and other areas on how to spot and report signs of modern slavery inside the organization and throughout the supply chain. Training should further explain and reinforce the organization’s code of conduct and principles for ethical business practices.
- Identify risks
Conduct assessments to identify and analyze supply chain risks, from end to end. This entails looking at direct and indirect suppliers, contractors and labor suppliers and taking steps to reduce risks within every link in the supply chain.
- Perform due diligence
Conduct audits of supply chain operations to find out how labor and material is sourced, and the prices paid to suppliers further down the supply chain. Engage with local stakeholders in different geographic locations, who understand the local operating environment and can identify risks of worker exploitation.
- Create a Supplier Code of Conduct
Implement written policies for suppliers that clearly outline standards and expectations for ethical behavior in the areas of labor, health and safety and the environment. Along with a written Code of Conduct, suppliers can benefit from training that explains their contractual obligations to comply with ethical business standards and practices.
- Profit with integrity
Leadership should be incentivized to stop modern slavery because it’s the right thing to do. Consumers, investors, business partners and regulators expect a company and its entire supply chain to be ethical. Organizations choosing supply chain partners should consider vendor ethics, as well as quality and cost.
To combat modern slavery in supply chains, which exploits millions of people each year, organizations need a comprehensive strategy to ensure the well-being of the people involved in their products, services and supply materials. Implementing controls, assessments, policies and training are among the proactive steps organizations can take to raise awareness and manage the risk of modern slavery and human trafficking in supply chains.