How to identify modern slavery in the supply chain

Our blog in May covered spotting the signs of modern slavery at site level, but how do you identify modern slavery in the supply chain, and why is this important?  

Apart from the moral responsibility to protect human rights, the Modern Slavery Act (2015) states that a criminal offence is committed if:

‘the circumstances are such that the person knows or ought to know that the (other person) is being required to perform forced or compulsory labour’.

In other words, ignorance is no defence, and due diligence is essential to demonstrate that all efforts have been made to assess and mitigate risks.

Whilst criminal prosecutions are more likely to be taken against criminal gangs exploiting victims on an industrial scale, civil litigation against organisations has been used to seek redress for victims and is now included in the new EU Corporate Sustainability Due Diligence Directive impacting both EU and non-EU companies.

A risk-based approach 

Modern slavery is not as visible in the materials and goods supply chain and therefore it is essential to implement a risk-based approach to supplier assessment and engagement.

A risk-based approach means having a methodical and systematic approach to identifying the highest risk suppliers in order to prioritise them for further engagement.  

Due to the nature of the required engagement, this step is typically most appropriate and practical for suppliers with a contractual relationship in Tier 1*.

The risk of modern slavery and the need to prioritise suppliers generally increases where:

• Suppliers are located in countries with a higher prevalence of modern slavery, according to the Global Slavery Index
• Work is labour-intensive and low paid
• There is a higher proportion of migrant workers in the workforce
• There are large numbers of temporary workers, particularly where recruitment or labour agencies are used

*N.B. Organisations with a mature modern slavery programme may also use a ‘saliency’ approach to prioritise suppliers, where the most commonly known and severe risks are prioritised, regardless of which tier the supplier occupies in the supply chain.

Identify gaps

The next step is to engage the highest risk suppliers and undertake supplier assessment to validate the estimated level of risk and identify any gaps requiring mitigation.  

Supplier assessments may include:

• Self-Assessment Questionnaires
• Interviews
• Visits
• Audits

More information on supplier risk assessment is available via Stronger Together’s free-to-download ‘Tackling Modern Slavery through Purchasing Practices’ toolkit.

Further resources including a Self-Assessment Questionnaire and a Template for Conducting Supplier Visits is also free-to-download via the Stronger Together website.

Traditional audits rarely uncover Modern Slavery, but the chances increase by using worker interviews, particularly one-to-one interviews in the workers’ native language.

For UK-based suppliers, Stronger Together’s Fast Forward Construction Audits are a unique capability development and continuous improvement approach to labour standards.  In addition to statutory requirements, the audits assess a range of ethical practices which can provide an indicator of modern slavery risk.

Furthermore, as highlighted by the United Nations’ Guiding Principles on Business and Human Rights, the most powerful way to identify actual exploitation in the supply chain is to ensure there are effective grievance mechanisms available for all workers. More guidance on this is available via Stronger Together’s ‘Good Practice Grievance Mechanism Effectiveness Checklist’.

Whatever action your organisation takes, customers, consumers, investors, governments and the broader international community continue to demand increased due diligence to tackle modern slavery, and all indications are that the direction of travel is unlikely to change any time soon.