Don't underestimate the power of due diligence. By investing in comprehensive background checks and vendor screening, you can mitigate procurement fraud risks and safeguard your supply chain.
The first step in the evolution of ethics is a sense of solidarity with other human beings
Is your organisation doing enough in its response to modern slavery including the exploitation of children. This crime against humanity takes many forms that includes debt bondage that facilitates forced labour. How does your organisation play its part in addressing this global problem?
There have been many global scandals of child labour being used in well-known international brands supply chain, from sportswear, electronic goods to children working in mines in the extractive industry. International organisations such as Amnesty international continue to research and report on global themes and ongoing problem.
Tony Blair as UK Prime Minister made a statement on slavery, "we also need, while reflecting on the past, to acknowledge the unspeakable cruelty that persists in the form of modern-day slavery. Today slavery comes in many guises around the world such as bonded labour, forced recruitment of child soldiers and human trafficking - and at its root poverty and social exclusion. "
Many countries and organisations globally have woken up to this and are taking proactive steps. The UN Global Compact has confirmed that forced labour and child labour are more prevalent in some countries and sectors, but none are immune to these abuses. The International Labour Organisation highlighted that at any given time in 2016, amongst these figures an estimated:
40.3 million people are in modern slavery, including 24.9 million in forced labour and 15.4 million in forced marriage.
1 in 4 victims of modern slavery is children.
Out of the 24.9 million people trapped in forced labour, 16 million people are exploited in the private sector such as domestic work, construction or agriculture
There are now over 9,000 corporate signatories to the UN Global Compact for business to be a force for good that includes aligning company strategies and operations to take action and advance the universal principles of human rights, labour, environment and anti-corruption goals.
Procurement fraud can cripple an organisation's reputation. Investing in risk mitigation demonstrates a commitment to ethical business practices and builds trust with international communities
SUPPORTING SUSTAINABLE DEVELOPMENT GOALS
So how do we put together an approach that targets and mitigates the risk of modern slavery and child labour within our supply chain and not just a tick box audit on whether a supplier has a policy. How do you demonstrate that your organisation is serious about this issue and in taking a risk based approach, is your organisation able to answer a number of key questions, specifically?
Are you able to map where the global threat is from people trafficking and modern slavery?
Do you carry out vendor visits to verify integrity in its working environment and practices
Do you have visibility of the vendor's supply chain and how that impacts the level of risk from your threat map?
What proactive steps has the vendor taken to mitigate this risk?
How do they mitigate risk in their own supply chain?
In key risk areas are vendors given training on your company policies and stance on child labour and modern slavery?
Do you have the ability to collect local intelligence on child labour and modern slavery practices in key risk areas?
Do you have a contract clause that stipulates vendor compliance with UN Global Compact requirements in the principles of human rights, labour, environment and anti-corruption?
Do you have a no notice audit contract clause to support a proactive approach where increased supply chain risk is identified?
DUE DILIGENCE APPROACH TO MODERN SLAVERY
A consistent approach should be taken at the vendor registration process to ensure that a vendor doesn’t bring an unknown risk into your organisation. In addition to the normal checks and balances taken during the onboarding of a vendor, an additional risk based approach should be taken to child labour and modern slavery. Within an international environment are you taking enough action to:
Research and vetting individuals, executives and shareholders of a company
Conduct due diligence of supplier background for undisclosed risks
Carry out onsite vendor visits to verify disclosures made by the supplier during the vetting process and verify ability to perform contract requirement
There is no one size fits all approach to mitigating your supply chain risk and the risk of slave labour and child labour being introduced, however, an organisation should take a proactive approach to mitigate its risks and develop its strategy and response plan should the risk increase or where non-compliance with this requirement is identified.
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