The content of modern slavery statements: This section addressed inconsistencies in reporting approaches taken by different companies and the possibility of making certain criteria mandatory. This section also sought to address the fact that global movements in modern slavery legislation may make it desirable to ‘harmonise our approach’. The questions posed focused on reporting practices and the implications of making certain areas mandatory.
Transparency, Compliance, and enforcement: The second section of the consultation sought to propose the introduction of a central government registry, one designed to improve transparency. It also addressed reporting deadlines, proposing a single annual reporting deadline so as to reduce the confusion of multiple separate deadlines throughout the year. It finally sought to gain views into how section 54 of the Modern Slavery Act might be enforced. Questions were posed on each of these areas.
Public sector supply chains: The final area addressed in the consultation examined public sector supply chains. In essence, the consultation proposed that reporting requirements would be extended to public sector organisations with a turnover of more than £36 million per year. Reporting requirements would be for each individual government body to maintain responsibility, whether given individually or as part of a group statement. The questions posed by this section of the consultation focused on the apparent benefits and challenges of imposing modern slavery reporting requirements on large public sector bodies.
However, whilst the use of technology to combat human trafficking and modern slavery is advancing in new directions and receiving high profile acclaim concerns have been raised that technology merely constitutes a tool and its use alone may not be enough. TechUK, an organisation responsible for representing approximately 900 companies that develop technology, has raised concerns that for technological tools to be truly effective corporations need to ensure they have a strong anti-slavery culture with a willingness to act. Whilst strong corporate and social anti-slavery cultures are vital, the development of technological tools and processes to target human trafficking and modern slavery demonstrate positive commitments by a wide range of actors to tackling these issues. Many of these technological developments are recognised as new and as these tools are refined it is quite possible that technology will take play a greater role in combating human trafficking and modern slavery.
In the development CSR, rights observers have understood that corporate interests generally outweigh the voluntary demand for an ethical and socially responsible supply chain. There are various examples of CSR that have developed, which compels corporations to comply with legal standards. For example the UK Modern Slavery Act 2015 that that dictates national legal standards, which requires corporations to publish the steps they are taking to ensure their supply chains and free of modern slavery, child labour, human trafficking. This regulation applies both domestically and for international sourcing, in which certain export standards of mandatory social compliance are placed onto developing countries with cheap labour. The California Transparency in Supply Chain Act (CTSCA) 2010 operates similar obligations but working at state level. The Indian Companies Act (2013) compels Indian corporations to spend 2% of their pre-tax profit on CSR.
How Child Rights fit into CSR
Although such legislation is aimed more broadly at achieving supply chain transparency, upholding child rights is a key element of this. Specifically, there is a set of 10 Child Rights and Business Principles as outlined by Save the Children, the UN Global Compact and UNICEF, which give a comprehensive yet non-exhaustive list of CSR requirements in relation to child rights. Corporations must:
Meet their responsibility to respect children’s rights and commit to supporting the human rights of children
Contribute to the elimination of child labour, including in all business activities and business relationships
Provide decent work for young workers, parents and caregivers
Ensure the protection and safety of children in all business activities and facilities
Ensure that products and services are safe, and seek to support children’s rights through them
Use marketing and advertising that respect and support children’s rights
Respect and support children’s rights in relation to the environment and to land acquisition and use
Respect and support children’s rights in security arrangements
Help protect children affected by emergencies
Reinforce community and government efforts to protect and fulfil children’s rights
The focus of CSR towards children aims to eliminate child labour from supply chains, but also must take the nuanced approach which includes protecting the rights of children in their core business strategy, covering all operations, employee rights, marketing, and delivery of products and services.
There has been an upraise in media on ethical supply chains in agricultural industries such as fishing, cocoa & coffee production, yet there are significant issues to be addressed in supply chain compliance and ethical sourcing compliance for the jewellery business – here addressing labour exploitation, child labour and human trafficking.
Examples of Human Rights abuses
Specifically in relation to child labour, estimates suggest over 1 million children work in artisanal or small-scale mining operations, despite being illegal at both the domestic level and by international law. Statistics from the African Centre For Economic Transformation suggest these children between 5 -17 are working on less than $2 per day, or receiving food as payment. Child labour has been reported in Ghana, Mali, Nigeria, the Philippines, Tanzania, and Zimbabwe, Burkina Faso, Uganda, the Democratic Republic of Congo, and Indonesia. However, regulation is lacking and children are continuously working in extremely dangerous and inhumane conditions, including exposure to toxic and explosive chemicals potentially causing brain damage, respiratory diseases from the dust, heavy strenuous lifting and exposure to dangerous machinery.
Concerning forced labour, it has been reported in Peru, Democratic Republic of Congo, Eritrea and in Zimbabwe where the military physically forced workers into diamond mining between 2008-2014. In the harsh conditions of the mining industry, workers are prevented from leaving either by blackmail or violence. In other cases, workers are trafficked to mines, by deception or force, in order to be exploited for mining work.
Wider rights abuses are continually taking place in the extraction industry, including land rights violations whereby indigenous populations have been displaced, armed conflict violations including money laundering to fund civil wars and violence by arming militias. Sexual violence, including abuse and torture by occupying mine workers, security guards and soldiers controlling mines has been reported, such as in Porgera mine, Papua New Guinea. Furthermore, environmental rights have been violated by disrupting 1000s of people and defecating habitats with toxic mine runoff, as in Nigeria 400 were children killed by artisanal mine toxic lead poisoning.
What are the current standards?
Alongside prominent Modern Slavery legislation, as seen developed in the UK, USA and developing in Australia, that holds businesses accountable for their own supply chain regulation, there are several international standards for human rights compliance yet none that are prominent enough to control this issue.
The United Nations Guiding Principles on Business and Human Rights declares that companies are by law required to undertake “human rights due diligence” within their entire supply chain. Furthermore, they must have systems in place to identify and remediate human rights abuses immediately. However, when it comes to implementation this only document offers only ‘guidance’.
Furthermore the Kimberley Process Certification Scheme (KPCS) is a significant international standard relating specifically to diamond extraction, to eradicate “blood diamonds” or “conflict diamonds”. However, again this proves too narrow, as it does not cover human rights abuses outside of active conflict zones.
The Responsible Jewellery Council (RJC) provides a certification system for all stakeholders in the jewellery supply chain. However, as this is an industry led program, it fails to have the legal and regulatory weight to ensure due diligence is done. Instead, according to findings by HRW it has flawed governance systems in which most companies assign their whole credibility for human rights compliance.
Are jewellery companies adhering to Modern Slavery compliance regulation?
Two mining companies have monopoly over the global diamond industry, and account for over half of all diamond sales. De Beers, working from South Africa, Botswana, Canada, Namibia, and Russian company ALROSA. However, according to HRW, both of these fail to be transparent with the mines in which their diamonds are sourced.
Issue in difficulty for companies to trace their supply chains
With parallels to technology companies who source small parts from many locations, the jewellery industry has very complex supply chains, as oppose to fishing or agriculture where the total product (e.g. a fish) has one source of origin. For example diamond jewellery is handled by many actors, making it difficult for companies to trace their full supply chain. From the mines, diamonds are firstly sent to be cut and polished, whereby 70% of the global diamond supply is done in India and 20% in China, reflecting their low labour costs. The next stage in a generic supply chain is to jewellery manufacturers where the products are pooled and constructed. Finally they reach the end retailers, where the US has the largest market of 40% of global sales.
A crux of the issue is in the sale after the raw extraction process because as soon as the minerals go through the first process of trade or export, batches from many sites are often mixed up. This makes the sustainably and ethically sourced gems or metals untraceable from those that are product of exploitative labour. This is ultimately caused by negligence of the mine operators in dealing with and processing their products in a way in which they can be accounted for.
Some companies have CSR programs used to give back to the community and in exchange for their land use, build major infrastructure like schools, roads, and hospitals. (Harvard) However, there is speculation around using these methods as a way to be presented as human rights compliant, as these initiatives are undercut by their lack of transparency in their daily business operations and supply chain mechanisms. Analysis of the global extraction business points to the conclusions that this industry is fuelled by profit and capital gain, whereby there is a large disconnect between those that are receiving the benefits of the jewellery business and those that are suffering. This issue is on-going because perpetrators will not have interests in alleviating the abuses from their supply chains, unless legally forced to, or compelled by their customers through suspended of business.
Claiming to be ‘ethically sourced’, tobacco fields are one of the biggest cash crops in the developing world yet have one of the most corrupt supply chains. Tobacco farms are worked on by children labouring excessive hours for minimal or no pay, while tobacco companies reap the multi-billion dollar benefits of the industry.
On our analysis, this is problematic not only because of the short-term consequences on the health and social rights of the workers, but also as it fuels the longer-term demand for the toxic, pollutant and addictive recourse. This demand is rising in the vulnerable areas of Asia, Africa while decreasing in the West due to education, taxation and policy restrictions. Abolition of child agricultural labour is a high policy agenda for the new Zimbabwean government, and a fundamental step in promotion of a stable democracy throughout other developing states that are also the production sources of tobacco.