Under the UK Modern Slavery Act, which came into force in October 2015, commercial organisations with a turnover of £36m or more, that supply goods and services in the UK, must publish an annual statement explaining what they are doing to eliminate slavery from their supply chains. The statements must be iterative and show year on year progress. The reporting requirement applies to organisations with their financial year ending on or after the 1 April 2016.

Modern slavery, as defined by the Act, encompasses all forms of unjust labour: human trafficking and slavery, servitude and forced or compulsory labour. The prevalence of modern slavery in the UK and beyond cannot be overlooked or underestimated. A recent study by Walk Free found that slave labour contributes to at least 136 products made in 74 countries.

In the UK alone, the National Crime Agency identified over 3300 victims of human trafficking, many of whom are also subject to unfair working conditions. The fact that modern slavery is often hidden deep down in the tiers of the supply chain, and is rooted in the business culture where profit maximisation takes precedence over human worth, makes it very difficult to detect and deal with.

The Act has been designed to put the onus on businesses to monitor their suppliers and ensure there is no modern slavery at any stage of their supply chain. With the reporting requirement, businesses that fail to take meaningful action risk damaging their reputation and consequently their bottom line. This is because consumers, armed with valuable information, can now make informed decisions at the checkout, and in this world of fast communications, anyone caught out is instantly pilloried.

Apr-Jun 2016 Issue

The Chartered Institute of Procurement & Supply (CIPS)