The Modern Slavery Act is global legislation which requires comprehensive reporting and the publication of an anti-slavery statement.
With high profile cases involving consumer facing businesses already being reported in the press the reputational risk is huge. There are an estimated 45 million slaves in the world today most of which reside in Asia and Africa which are known as slavery hotspots.
Retailers, restaurants and travel businesses are all at risk due to the sourcing of products or services such as cotton, leather and readymade garments; food items such as rice, spices, tea, coffee, tobacco; as well as outsourced operations such as local activities provided by a tour operator, from modern slavery hotspots.
Operationally, having complete transparency across the whole supply chain, comprehensive monitoring and inspections, alongside strong relationships with subsidiaries and suppliers will help mitigate the risk of modern slavery.
So, what does the law say?
The Modern Slavery Act requires compliance by any company operating in the UK with a global turnover greater than £36 million. This involves an anti-slavery statement published on a company’s homepage which needs to be signed off by the board or senior management as well as specific reporting and disclosure that demonstrates efforts to mitigate slavery within the company and along its supply chain.
The timeline for mandatory disclosure is six months after the publication of a company’s annual reports and accounts. This applies to all qualifying companies who publish annual reports after 31 March 2016.
Will it work and how will the act be enforced?
Whilst some might think it is too early to assess the scale of compliance, or that the Act lacks the teeth to have any real impact, we believe the new regulation will have more than enough impact on many companies in the UK.
The reputational risk to consumer companies is particularly serious because often the supply chain resides in high risk areas. Modern Slavery has a high profile in the UK. It is time that the Act is taken seriously.
How do I protect my business?
Consumer companies need to ensure they have a comprehensive action plan in place to mitigate and eradicate modern slavery.
This will involve:
- submitting a written online statement;
- risk analysis – where are you most at risk?;
- supply chain transparency and efficiencies;
- supplier and subsidiary relationships and agreements;
- monitoring and reporting processes; and
- embedding systems, education and policies that will help to combat modern slavery in all areas of your businesses.
How we can help