In autumn, following our successful campaign for the introduction of the Transparency in Supply Chains (TISC) clause into the Modern Slavery Act 2015, we participated in discussions designed to inform the content of the accompanying Home Office statutory guidance for commercial organisations required to report under the new law.
While the Home Office guidance gives a helpful basic overview of the TISC clause, civil society organisations felt that more detailed information was needed for companies already engaging with labour rights issues in their supply chains.
Several companies had also mentioned that additional guidance from civil society, setting out good practice in a range of areas related to the new reporting requirement would be useful.
Over the last few months, we’ve been working closely with our partners from Amnesty International UK, Anti-Slavery International, CAFOD, Focus on Labour Exploitation (FLEX), Know the Chain, Quakers in Britain, ShareAction, Traidcraft, Unicef UK, ECPAT UK, Dalit Freedom Network UK, Walk Free and Unseen on Beyond Compliance: Effective Reporting under the Modern Slavery Act. We’re delighted to be launching it formally today.
Preparing Beyond Compliance was very much a coalition effort, with each organisation drawing on its specific expertise to contribute different sections of the document. Links to the contributing organisations’ websites can be found in the last section of the guidance, along with a list of resources which provide further information on specific issues.
Beyond Compliance provides ideas on how companies can respond effectively to the new provision by linking the wider due diligence needed to eradicate human trafficking, forced labour and slavery from their supply chains to their reporting. The guidance will be updated to reflect leading practice in this area as more companies take action.
It’s published at a timely juncture in the Act’s development, as an initial flurry of company statements appears in anticipation of the first reporting deadline on 31 March.
As reported in today’s Financial Times, a review of these first 75 statements by CORE and Business & Human Rights Resource Centre found that the many do not meet the requirements of the legislation. 33 are not signed by a company director and 33 companies haven’t placed a link from their website’s homepage to their statement. Only 22 meet both requirements.
While the Act does not require companies to include specific information in their statements, it does suggest six specific areas to report on: organisational structure, business and supply chains; relevant policies; human rights due diligence; parts of the business where there’s a risk of slavery taking place and steps taken to address those risks; training; and effectiveness in addressing slavery and human trafficking. Our review found that only 9 of the statements published to date cover all six topics and meet the minimum legal requirements.
The global reach of the Modern Slavery Act – it applies to companies operating in the UK, not only those registered here – has led to it being described as a potential “game changer” on company supply chains.
To make this a reality, companies have to see the reporting requirement as an opportunity to understand the risks of modern slavery occurring in their business operations, paying particular attention to business models, operating context and the nature and location of work. A bare minimum, box-ticking approach cannot become the norm.
Government also needs to do more. There’s also no way of knowing at present which companies are covered by the reporting requirement. Identifying non-UK registered companies is a challenge, but government could easily provide a partial solution by publishing a list of UK companies with a +£36 million turnover. In the absence of a central repository for company reports, Business & Human Rights Resource Centre has created a registry of statements. Other similar initiatives may emerge. Government should clearly communicate to companies its expectation that reports are uploaded to these facilities.
The number of reports published and the content of those reports are important, but the real measure of TISC’s success will whether it results in an end to business practices that increase the risks of slavery and forced labour in supply chains. Company boards must now step up and show the leadership necessary to achieving this transformation.
