A year after the UK Modern Slavery Act, time for a Global Modern Slavery Agreement?

Friday, 31 March 2017 09:16 GMT

Britain's Prime Minister Theresa May leaves 10 Downing Street in London, March 29, 2017. REUTERS/Stefan Wermuth

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One hundred and fifty years since abolition, it seems some political leaders believe it is time to finish the job

One year ago today, companies started reporting under Prime Minister Theresa May’s ground-breaking legislation on modern slavery. The UK Modern Slavery Act demands that all large companies, globally, who operate in the UK market, provide an annual, board-approved, publicly available statement that describes what they are doing to eliminate the curse of modern slavery in their operations and supply chains. So far over 1700 companies have released statements which are now searchable on our central registry.

Our latest analysis reveals a small cluster of leading companies, including HP, Apple, Primark, and British American Tobacco, whose statements demonstrate a strong commitment to this cause. But there is a far longer list of companies who have yet to begin a journey to even identify where they have risks of forced and child labour. Nevertheless, a large number of companies have told us that this government demand for mandatory transparency has provoked substantial discussion and movement amongst bosses, and the impact of the Act, even with its punches pulled, demonstrates the power of collaboration between government, business and civil society to achieve a level playing field of mandatory transparency.

Amidst Government Initiatives, a Global Movement is Building

Theresa May is not alone. Something is stirring in the governments of Europe, North America, and further afield. There is a rising sense that modern slavery in its many ugly forms - bonded labour, human trafficking, harmful child labour - is no longer tolerable either domestically or in global supply chains. One hundred and fifty years since abolition, it seems some political leaders believe it is time to finish the job.

The USA, with bipartisan support, closed loopholes in law, and created new business incentives through the 2015 Trade Facilitation and Trade Enforcement Act. The German and Dutch Governments are driving human rights due diligence in textiles. The Dutch Government has passed a new law on child labour. The Australian Parliament has opened an Inquiry on whether it should adopt its own Modern Slavery Act.  

Angela Merkel, as chair of the G20 this year, is encouraging her G20 peers to promote human rights due diligence in their companies’ operations and supply chains.

Indonesia and Australia are reinvigorating the Bali Process on people trafficking which for the first time this year includes private sector participants. Action on eliminating modern slavery looks set to accelerate.

Leading companies, trade unions, investors, the United Nations’ Alliance 8.7, and civil society are also encouraging governments around the world to build on this early momentum. A diverse international movement is emerging.

Avoiding ‘Spaghetti Soup’

But an existential risk is surfacing: if governments all unilaterally design legislation then companies could understandably complain that they face a ‘spaghetti soup’ of, perhaps, 30 inconsistent sets of national legislation to eliminate slavery. But governments can and should cooperate to take the best of existing regulation and incentives, and set a common minimum standard of corporate behaviour. At the least, governments can coordinate to ensure coherent national laws that establish a level playing field for business. At best, like-minded states could establish an international high-standard reflected in national legislations. We need a Trans-Atlantic, or perhaps Global Modern Slavery Agreement.

A Smart Mix of Regulation, Incentives and Voluntary Action:

An effective international standard would build on and integrate effective government action so far. This falls into four categories: mandatory transparency; mandatory due diligence; incentives for action; and access to justice and remedy.

Best practice in mandatory transparency is the UK Modern Slavery Act. The Act requires all businesses that operate in the UK with turnover above £36 million, to provide a public statement on what they are doing to eliminate modern slavery from their operations and supply chains. A key strength of the Act is its extra-territorial reach: it applies to companies from around the world who want to operate in the UK market.

While this Act demonstrates welcome leadership in demanding mandatory transparency, the Government missed the opportunity to amplify the Act’s impact through 1) a list of all the companies they believe are captured by the Act’s reporting requirement to increase the duty of compliance, 2) a registry and benchmark for company statements – to monitor the implementation of their own legislation.

Best practice in mandatory due diligence comes from the USA. President Obama’s bipartisan initiatives to close loopholes through the Trade Facilitation and Trade Enforcement Act have jolted debate and action after just a handful of shipments of goods have been seized. If an importer is using suppliers from sectors and geographies identified as having high risk of modern slavery, then the importer must demonstrate due diligence to exclude modern slavery. Otherwise, there is a risk that the goods will be impounded at port.

Best practice in public procurement is scarce at present, though it can generate major incentives for companies to eliminate slavery. The US Federal government, alone, has annual procurement spending of $350-500 billion, and public procurement is 14% of GDP in the European Union. The US Federal Acquisition Regulation provides leadership. It prohibits federal contractors and subcontractors from using some specific recruitment practices that make workers vulnerable, and puts reporting requirements on those performing work over $500,000 outside the US.

Perhaps in need of the most development is providing victims of modern slavery in business supply chains access to remedy. The US Trafficked Victims Protection Act is an example that can be built on.

There are still voices that oppose concerted action by governments. They seek to describe laws to eliminate modern slavery as protectionist restrictions on trade, or a cost to business. It is neither. Instead, it should be the end-game of a struggle to end the unconscionable and brutal trade and ownership of fellow human beings, that we hoped had ended some 150 years ago.

Phil Bloomer, executive director, Business & Human Rights Resource Centre

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