This Sunday marks the 75th anniversary the Universal Declaration of Human Rights (UDHR) — the signing of which is celebrated each year on Humans Rights Day. The theme for this year’s observance is: Dignity, Freedom, and Justice for All. Article 4 of the UDHR states: “No one shall be held in slavery or servitude; slavery and the slave trade shall be prohibited in all their forms.” Three quarters of a decade since that declaration was adopted, slavery and forced labor have yet to be extinguished. Conservative estimates range as high as 40 million people around the globe still being held as slaves or forced laborers — many whom make the products we use and grow the food we eat. Michael Ford, Global Lead on Environment, health and safety (EHS) and Sustainability at Avetta, writes, “The impact of modern slavery being identified within your supply chain should not be underestimated.”[1] He adds, “Actions can be taken to remove this practice, but it is essential to understand what is meant by the term ‘Modern Slavery.’ It is often used as an umbrella term that includes bonded labor, descent-based slavery, forced labor, early and forced marriage, and human trafficking — all of which can include children as well as adults.”

Identifying Supply Chain Slavery

Obviously, the slave labor problem can’t be addressed if the locations where it’s taking place aren’t identified. Attorney and freelance writer Rosemarie Lally reports that some countries around the world “have implemented domestic forced labor due diligence laws for supply chains.”[2] Those laws provide a framework for identifying and eliminating slavery within corporate supply chains. Lally writes, “[Jean-François Gerard, an attorney with and global head of practice development for Freshfields Bruckhaus Deringer in Brussels,] suggested employers ensure they’re in compliance with their local legislation to ensure their supply chains are free of exploitative labor practices. As an example, he pointed to the German Supply Chain Due Diligence Act, which requires that companies perform certain basic obligations.” Those obligations include:

• Establishing a risk management system and conduct a risk analysis.
• Adopting a policy statement on corporate human rights strategy.
• Anchoring preventive measures in the company’s own business operations and vis-à-vis direct suppliers.
• Taking corrective action in the event of identified violations of the law.
• Establishing a complaint procedure in the event of legal violations.
• Fulfilling documentation and reporting obligations.

Justin Dillon, founder and CEO of FRDM, indicates that consumers are often the catalysts who stir governments and businesses into action. When he first became active in the anti-slavery movement, he says, “Consumers showed up first, which is the fuel for politics and for governments to act. And then government causes businesses to act.”[3] Although consumer activity remains important, Dillon believes it’s time for business to act as well. He states, “I think consumers have done their bit and continue to do so. But what they want they can’t have right now. And that is transparent supply chains. They want to know you’re not using children going into mines in Congo, or families being thrown into boats to go fishing for shrimp and never see land.”

Addressing Supply Chain Slavery

Let me be clear. Addressing supply chain slavery is a very difficult task. Slavery and forced labor are often buried deep in a company’s supply chain — well beyond direct suppliers. Thomas Lobert, a Solutions Consultant with Descartes, explains, “[Forced labor] can happen any time in the supply chain: from sourcing raw materials to manufacturing products, including distribution. … The entire chain must be able to be audited. … As global supply chains are infinitely complex and constantly in motion, establishing long-term, reliable risk monitoring and visibility is challenging.”[4] Although more governments are enacting legislation aimed at halting slavery and forced labor, supply chain journalist Matthew Gideon notes, “The creation and enactment of legislation related to forced labor and slave labor doesn’t mean that companies will stop using these practices.”[5]

Nevertheless, the always hopeful Dillon told Gideon, “Legislation always goes forward. These laws are only going to become more specific. There will be increased penalties and new thresholds for compliance. … That’s progress. That’s how you’ll push the rats out, by having everybody going in the same direction, where there are no openings where somebody that’s doing nefarious activities can sell their products. I believe in that systemic change. I believe the regulations are well set up.” Jackson Wood, Director of Industry Strategy for Global Trade Intelligence at Descartes, notes that many countries have adopted a “presumption of guilt” approach when it comes to enforcing regulations.[6] This means companies must be extra diligent in proving their compliance.

Wood asserts, “With increasing volatility and complexity of the global supply chain, the need for greater intimacy and transparency across the supply chain grows. A paradigm shift is underway, as the global trade ecosystem recognizes the imperative for trust-based supply chains that expose illicit labor practices. … Importers must ask their partners and suppliers for proof that forced labor issues are on their radar. Are their suppliers taking steps to mitigate risk in their business? What about their suppliers’ suppliers? Putting a framework around these questions helps companies develop due diligence practices to identify forced labor risks hidden in the supply chain.” Wood goes on to suggest that companies should evaluate their compliance program to ensure they are accomplishing five things:

1. Mapping third-party relationships to build a full picture of their forced labor exposure.
2. Understanding international corporate networks and ownership structures.
3. Ensuring access to the right content (e.g., building due diligence data sets).
4. Accessing tech capabilities that can use the content and execute dynamic screening at scale.
5. Integrating screening into business infrastructure systems (e.g., ERPs, CRMs).

He concludes, “Using a programmatic approach to prioritizing the supply chain for human rights due diligence is not only the smart legal, ethical, and financial choice but a competitive differentiator. Investment in and commitment to compliance is an enabler of growth, and accelerates brand equity. From a commercial perspective, if companies demonstrate strong compliance and risk mitigation, they will thrive in challenging markets in which other competitors might not be poised to handle the regulatory challenges presented by that jurisdiction.”

Concluding Thoughts

Freelance writer Nithin Coca believes artificial intelligence will play an important compliance role in the years ahead. He explains, “As companies began to face reputational risk due to civil society groups and journalists uncovering human rights or labor abuses from suppliers that many did not even realize were supplying them, there’s been a push to better manage and ensure supply-chain transparency, with technology playing a key role. … [Experts] see a real role for AI in pushing us towards a more sustainable and ethical business future. While AI won’t make supply chains transparent or sustainable on its own, it can be a valuable tool for dedicated brands and enable real, meaningful action at scale.”[7] Of course, eliminating slavery is only one issue associated with Human Rights Day. The staff at the United Nations notes, “The promise of the UDHR, of dignity and equality in rights, has been under a sustained assault in recent years. As the world faces challenges new and ongoing — pandemics, conflicts, exploding inequalities, a morally bankrupt global financial system, racism, climate change — the values, and rights enshrined in the UDHR provide guideposts for our collective actions that do not leave anyone behind. The year-long Human Rights 75 initiative seeks to shift the needle of understanding and action towards greater knowledge of the universality of the UDHR and the activism associated with it.” The supply chain certainly has a role to play. In fact, Dillon insists, “The supply chain is how you fix this — not governments, not laws.”

Footnotes
[1] Michael Ford, “Modern slavery takes many forms; is it present within your supply chain?” IT in the Supply Chain, 5 March 2020.
[2] Rosemarie Lally, “How to Identify Forced Labor in Supply Chains,” SHRM, 19 December 2022.
[3] Helen Atkinson, “Eradicating Slave Labor Starts with a More Transparent Supply Chain,” SupplyChainBrain, 10 July 2023.
[4] Thomas Lobert, “Three things to know about forced labour & its implications within the global supply chain,” IT in the Supply Chain, 8 November 2023.
[5] Matthew Gideon, “How to Combat Endemic Forced and Slave Labor in Supply Chains,” SupplyChainBrain, 24 October 2023.
[6] Jackson Wood, “Building Trust-based Supply Chains to Mitigate Forced Labor Risk,” SupplyChainBrain, 4 October 2023.
[7] Nithin Coca, “AI Is Helping Brands Address Forced Labor in Supply Chains,” Sustainable Brands, 14 September 2023.