Combat Modern Slavery in Supply Chains: A Strategic Guide for Procurement Professionals

Modern slavery, encompassing forced labour, human trafficking, debt bondage, and child labour, remains a pervasive issue within the global economy. Despite significant regulatory and societal pressures, it continues to persist across both international and national supply chains. Procurement professionals, with their direct involvement with suppliers, are uniquely positioned to enforce ethical standards and influence change. However, addressing modern slavery requires a comprehensive, multi-faceted approach that goes far beyond mere compliance.

This guide offers a strategic framework for procurement professionals to identify, address, and prevent modern slavery in their supply chains. By following these steps, businesses can take tangible actions to uphold human rights while mitigating reputational and operational risks. This roadmap aims to shift companies from a reactive stance to a proactive leadership role in eradicating exploitation.

Step 1: Cultivating Internal Awareness and Responsibility

Objective: Foster an internal culture of vigilance and accountability regarding modern slavery.

1.1 Training and Sensitisation

· Education for Procurement Teams: Implement comprehensive training programmes for procurement teams to identify and tackle potential instances of modern slavery. This training should cover:

· Definitions and forms of modern slavery (e.g. bonded labour, child trafficking).

· Recognisable indicators of labour exploitation.

· Geographic and industry-specific risk factors.

· Securing Executive Commitment: Ensure senior management understands the importance of anti-slavery measures and is committed to supporting them. Executive leadership must demonstrate a clear willingness to invest in ethical procurement, thereby creating a corporate culture that prioritises human rights.

· Cross-Departmental Collaboration: Promote a holistic approach across departments, particularly legal, compliance, and human resources. Many indicators of modern slavery overlap with areas monitored by these teams, making their involvement essential.

1.2 Policy Development and Dissemination

· Supplier Code of Conduct: Create a comprehensive supplier code of conduct that explicitly prohibits the use of forced or trafficked labour. This document should clearly outline expectations and the consequences of non-compliance.

· Internal Procurement Policies: Establish internal policies that emphasise ethical sourcing, including robust supplier vetting procedures and clear guidelines on how to deal with any instances of modern slavery.

Step 2: Conducting Risk Assessments and Mapping Supply Chain Risks

Objective: Identify vulnerable areas within the supply chain where modern slavery may be present.

2.1 Geographic Risk Profiling

· Mapping High-Risk Regions: Use established indices, such as the Global Slavery Index or reports from the International Labour Organisation, to identify countries where modern slavery is more likely to occur.

· Focus on areas with weak labour law enforcement, high poverty rates, and industries known for exploitation, such as agriculture, mining, and manufacturing.

· Tiered Risk Assessments: Implement a risk-based approach, prioritising suppliers that pose the highest potential threat. This assessment should consider:

· The supplier’s location and the socio-economic conditions of that region.

· The specific industry or sector.

· The nature of the products being sourced (e.g. raw materials are typically at greater risk than processed goods).

2.2 Supplier Risk Evaluation Tools

· Supplier Self-Assessments: Require suppliers to complete detailed questionnaires that explore their labour practices, recruitment processes, and worker treatment, with a focus on vulnerable groups such as migrant and seasonal workers.

· Third-Party Certifications: Where available, seek certifications from independent bodies such as the SA8000 Standard or the Sedex Members Ethical Trade Audit (SMETA). These audits help ensure that suppliers comply with internationally recognised labour standards, including fair wages, safe working conditions, and freedom from coercion.

· Technology-Enabled Transparency: Utilise digital tools such as blockchain to track labour conditions and supply chain activities in real time. Technology can offer greater visibility, reducing the opacity that often conceals exploitative practices.

Step 3: Establishing Due Diligence and Ongoing Supplier Monitoring

Objective: Implement a thorough due diligence process and maintain continual oversight of suppliers.

3.1 Supplier Prequalification and Vetting

· Comprehensive Screening: Before engaging a new supplier, carry out a rigorous prequalification process. This involves background checks on the supplier’s operations, history of compliance with labour standards, and an assessment of recruitment practices.

· Particular attention should be given to industries and regions known for labour abuses.

· Review the transparency of the supplier’s operations, including any use of subcontractors, as outsourcing often conceals labour risks.

· Labour Practice Audits: Where possible, conduct on-site audits to directly assess working conditions. In high-risk locations, ensure worker interviews are conducted privately and that dormitory conditions and recruitment practices are scrutinised for signs of exploitation, such as excessive recruitment fees (a common indicator of bonded labour).

3.2 Ongoing Monitoring and Engagement

· Scheduled and Surprise Audits: Conduct regular audits, especially for suppliers operating in high-risk areas or industries. Incorporating both scheduled and unannounced audits into the compliance framework ensures that suppliers maintain standards consistently, rather than preparing specifically for inspections.

· Worker Feedback Mechanisms: Establish confidential and independent reporting channels, such as hotlines or digital platforms, for workers to report concerns about forced labour or exploitation. Providing workers with a secure way to report issues helps uncover violations that might not surface during formal audits.

· Collaborative Supplier Relationships: Rather than a purely compliance-driven approach, foster a collaborative relationship with suppliers. Offer support for ethical improvement initiatives, such as training programmes on workers’ rights or helping suppliers develop better management systems. By building trust, companies can encourage longer-term commitments to ethical labour practices.

Step 4: Addressing Violations and Providing Remedies

Objective: Respond swiftly and appropriately to any instances of modern slavery, ensuring that victims are protected and future violations prevented.

4.1 Clear Remediation Protocols

· Predefined Response Strategies: Develop clear protocols for responding to confirmed instances of modern slavery. Immediate actions should include:

· Reporting the violation to the relevant authorities.

· Suspending or terminating contracts with the supplier (where necessary).

· Collaborating with human rights organisations or NGOs to support affected workers, ensuring they receive compensation, legal assistance, and safe housing.

· A Victim-Centred Approach: Always prioritise the needs of workers impacted by forced labour. Beyond removing them from exploitative conditions, work with NGOs to ensure they have access to legal, psychological, and social support services. If the workers are migrants, help facilitate safe repatriation where appropriate.

4.2 Supplier Corrective Actions

· Corrective Action Plans (CAPs): For suppliers where improvement is feasible, work with them on a corrective action plan. This plan should clearly define steps to address labour violations, such as:

· Eliminating exploitative recruitment fees or practices.

· Implementing fair wage structures.

· Strengthening oversight of subcontractors and recruitment agencies.

· Capacity Building: Provide resources to suppliers to support their efforts to meet ethical standards. This may include offering training or facilitating access to tools that improve labour management. Assisting suppliers in their transition to ethical practices can foster a more sustainable relationship.

Step 5: Collaborating with External Stakeholders

Objective: Leverage partnerships with industry bodies, NGOs, and governments to strengthen anti-slavery efforts and share best practices.

5.1 Industry-Wide Initiatives

· Engage in Multi-Stakeholder Platforms: Join industry coalitions such as the Ethical Trading Initiative (ETI) or the International Labour Organisation’s Better Work programme. These platforms allow companies to pool resources and knowledge, while collectively applying pressure on suppliers to uphold labour standards.

· Benchmarking and Data Sharing: Transparency across the industry is crucial for reducing exploitation. Share non-competitive data on high-risk suppliers and collaborate with other businesses to improve visibility and ethical standards across the supply chain.

5.2 Partnering with Civil Society Organisations

· NGO Partnerships for Audits: NGOs often possess a deeper understanding of local labour conditions than private companies. Partnering with them for supplier audits can offer a more informed view of local realities, particularly cultural and socio-economic factors that may influence labour practices.

· Support for Victims: Form partnerships with organisations that specialise in supporting victims of forced labour. These partnerships can help provide legal aid, safe accommodation, and rehabilitation services for those affected. Ensure victims receive fair compensation for their work once freed from exploitation.

Step 6: Transparency and Public Reporting

Objective: Enhance accountability by disclosing anti-slavery efforts to stakeholders, building trust and credibility.

6.1 Public Disclosure

· Modern Slavery Statements: In jurisdictions like the UK and Australia, businesses of a certain size are required to publish annual modern slavery statements. These statements should provide a candid assessment of the company’s supply chain risks and outline the actions taken to address any identified issues. Voluntary disclosure in countries without such requirements can still boost public trust and demonstrate leadership in corporate social responsibility.

· Transparent Supply Chains: Go beyond mandatory reporting by publicly disclosing key suppliers, especially in high-risk regions. Making audit results public, where appropriate, can encourage higher standards across the industry and reassure consumers and investors of the company's commitment to ethical practices.

6.2 Engagement with Investors and Consumers

· ESG Reporting: As environmental, social, and governance (ESG) considerations gain importance among investors, be prepared to demonstrate robust measures to mitigate human rights risks within the supply chain. Businesses with strong anti-slavery frameworks are likely to attract investors looking for lower reputational risks.

· Consumer Communication: Ethical consumption is on the rise, with many consumers actively seeking out products from companies committed to fair labour practices. Leverage anti-slavery initiatives as part of your broader corporate social responsibility (CSR) strategy. Transparent communication about your efforts can enhance brand loyalty and differentiate your business in competitive markets.

Step 7: Continuous Improvement and Adaptation

Objective: Ensure anti-slavery measures evolve with changing global conditions and incorporate best practices.

7.1 Regular Review of Policies and Practices

· Annual Policy Evaluation: Supply chains and labour risks are constantly evolving. Conduct an annual review of your anti-slavery policies to ensure they reflect changing regulatory landscapes, emerging risks, and industry best practices.

· Adapting to New Threats: Stay informed about new developments in modern slavery, such as shifting trafficking routes or regulatory changes. Be ready to adjust procurement strategies accordingly.

7.2 Accountability through Internal Audits

· Third-Party Evaluations: Periodically engage external auditors to review the effectiveness of your anti-slavery measures. Independent evaluations offer an objective assessment, ensuring any gaps in the framework are promptly addressed.

· Tracking Key Performance Indicators (KPIs): Develop clear, measurable KPIs related to anti-slavery initiatives. These may include the number of audits conducted, the percentage of suppliers adhering to ethical standards, or the number of workers removed from exploitative conditions. Tracking progress through KPIs enables companies to demonstrate their commitment and improvement to stakeholders.

Conclusion

The fight against modern slavery is a challenging yet urgent responsibility for procurement professionals. While regulatory compliance is essential, a more strategic and proactive approach is needed to drive real change. By fostering internal awareness, conducting rigorous risk assessments, collaborating with suppliers and external partners, and maintaining transparency, companies can mitigate risks and contribute to the global effort to eliminate forced labour.

Procurement professionals play a pivotal role in this fight, helping to protect vulnerable workers, safeguard their companies from reputational damage, and ensure the long-term sustainability of ethical supply chains. With a structured, proactive approach, businesses can take a leadership role in the global movement to eradicate modern slavery.