Rights group shows companies how to spot slavery in supply chains

by Katie Nguyen | Katie_Nguyen1 | Thomson Reuters Foundation
Thursday, 4 September 2014 04:30 GMT

Tia Tete blesses a fire before a dance performance at the community of Quilombo Sao Jose, marking the anniversary of the abolition of slavery, in Valenca, Rio de Janeiro state. Picture May 17, 2014. REUTERS/Ricardo Morae

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Companies may find their involvement in slavery or child labour is bad for shareholder value, a bank's report says

LONDON (Thomson Reuters Foundation) - Companies that care about their brand should do more to make sure no slave labour is used in their supply chains, a human rights group said on Thursday, as it launched an anti-slavery guide for businesses.

Walk Free Foundation's 33-page guide, aimed at companies and governments, outlines ways of identifying the "red flags" of slavery in supply chains and key steps in conducting an audit.

It also provides guidelines for tackling cases of modern slavery and creating incentives to encourage suppliers to manage their workforce better.

"Slavery in the supply chains is an abuse of human rights in the pursuit of profits. Organisations have a duty not to tolerate it but to directly tackle it," said Peter Nicholls, the CEO of global business accreditation for the Walk Free Foundation.

"If companies want a supply chain that reflects their brand and not a brand that reflects their supply chain, they've got to accept that when they take on global sourcing there's a responsibility," he said by phone from Perth in Australia.

The Australia-based foundation estimates that 30 million people around the world are trapped in slavery, most of them forced into domestic work or manual labour - especially in "high risk" industries such as construction, tea, cocoa, fishing and manufacturing.

The International Labour Organization has said forced labourers generate $150 billion a year for those who exploit them.

Yet eliminating slave labour from supply chains in the public and private sector remains one of the greatest challenges countries face in combating modern day slavery, a survey by the foundation found earlier this year.

Fewer than half the 30 countries that responded to the survey had regulations in place to discourage investors from dealing with businesses that use slavery in their supply chains, or laws and policies to encourage companies to remove slavery from their supply chains.

In Britain, which is considering a draft law to combat slavery, a lawmaker accused Prime Minister David Cameron last month of balking at the idea of making listed companies report on how they were checking their chain of suppliers for signs of forced labour.

Yet campaigners say consumers want more scrutiny of how goods are produced and there are signs that investors are taking more interest in the issue.

This month Citigroup issued a 152-page analyst’s report assessing the risks to companies resulting from their involvement in slavery or child labour. 

“Human rights controversies including modern slavery and child labour could be detrimental to shareholder value, through reduced sales or business opportunities or diversion of management and board resources,” it said.

(Editing by Tim Pearce; timothy.pearce@thomsonreuters.com)

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