REAPING THE BENEFITS OF MANAGING MODERN SLAVERY RISK EFFECTIVELY
R&C: In the six years since the Modern Slavery Act was enacted in the UK, have you seen a shift in attitudes toward compliance?
Cobb: In 2015, when the Modern Slavery Act (MSA) came into force in the UK, many companies were hesitant about how much compliance resource to deploy in this space. Given that the MSA did not, and continues not to, attract a financial penalty for non-compliance, bribery and corruption and non-compliance with the Bribery Act in the UK and the US Foreign Corrupt Practices Act (FCPA) were deemed to be a bigger risk, and thus worthy of more management attention. Over the past few years, however, there has been a proliferation in regulation related to forced labour and human trafficking, including legislation in Canada, Australia, Norway, Germany and across Europe, as well as proposed amendments to the UK legislation. This has sharpened business focus on the human rights of their workforces and has increased demands on businesses to take responsibility, not only for their own actions but also for those of their supply chains. Heightened societal awareness and growing investor focus on ESG issues and specifically on human rights compliance have increased the pressure on companies to take action. Added to this impetus, there have been several high-profile cases globally which have played out in the press; companies now see the impact of getting it wrong as well as the cost associated with an investigation, the severe reputational damage to brand and board reputation that follows, and the resultant loss of investment.
Jan-Mar 2022 Issue
FTI Consulting