The first tranche of annual statements showing the actions that businesses have taken to combat modern slavery have now been published by employers. So, what can we learn from them? Phil Allen, Partner and employment law specialist at Weightmans LLP, suggests five steps that employers can take to improve their modern slavery reporting.
March 2017 marks a year since the Modern Slavery Act came into force. Implemented during Theresa May’s tenure as home secretary, the legislation is designed to fight slavery and human trafficking by enlisting the support of the UK’s largest commercial organisations.
Businesses with an annual turnover of at least £36 million are required to show the actions they’ve taken to combat the issue, by creating an annual statement. The statement is required to be prominently placed on the company’s website and it must detail the steps it has taken or planned to ensure abuses aren’t occurring in its own organisation and supply chain.
While there are limited penalties for non-compliance, employers that fail to do so, or make only a lacklustre effort, run the risk of incurring reputational damage. The media and a company’s stakeholders, suppliers, customers and staff are effectively charged with the role of regulator. Being named and shamed as uncooperative could result in an employer’s important commercial relationships being damaged.
However, compliance with the Act should not be viewed simply as an exercise in good public relations. Modern slavery is a troublingly relevant issue for many UK sectors, both those with and without an international supply chain. Statements should provide genuine evidence that substantial due diligence, training and the investment of time and resource has been undertaken, aimed at stamping out slavery and human trafficking.
The first tranche of statements have now been published by employers – and it’s fair to say the results are mixed. As more businesses prepare to publish their statements, there are a few simple steps organisations can take to make sure their output is up to scratch.
Secure the full buy in of your organisation
It’s very important that every level and department of an organisation is aware of the reporting obligations and their importance. This is not just an HR issue, indeed procurement or buying teams can often be at the forefront of ensuring the organisation has a good story to tell. Only then can a comprehensive statement that covers the entire business and its supply chain be produced and published in an appropriate place.
For example, the statement must be present on an organisation’s UK home page, not buried in the CSR section of its website. If a critical party casts a cursory eye over a business’s online presence, they should be able to see the statement immediately.
To achieve this, the full buy-in of the IT department is required – and this can present a challenge, particularly for international organisations reticent to allow regional variation of on-line presence.
Different departments have their own strategies and objectives to meet and the Modern Slavery statement may not be at the top of their agendas. A centralised approach to educating and informing staff should therefore be implemented. This could be in the form of an internal communications campaign or through a specially designed training programme. The priority is to ensure everyone who needs to be involved in the production and operation of a quality statement knows their responsibilities and is ready to put in the effort required.
Bring your statement to life
It is very easy to copy the example statement produced by the Government, but those that do risk creating the impression that they are merely paying lip service to their responsibilities. It is therefore essential for organisations to invest time and effort to create a bespoke, detailed statement that is relevant to their sector.
Employers should use all the resources at their disposal to achieve this. Good quality design can be used to make the statement bright and engaging, and bring data to life. Including testimonials from staff who have been involved in initiatives to tackle slavery and human trafficking will also help to demonstrate the scale of the organisation’s commitment to tackling the issue.
Publish a dynamic statement year-on-year
The first statement an organisation produces will be the simplest. It can be a mission statement, outlining the actions it plans to take over the next year to root out any evidence of modern slavery in its organisation and supply chain. Two or three years down the line, creating a statement with the same amount of content will be more difficult – especially if you are a UK-based organisation with no international supply chain. But despite this, employers from every sector must work hard to find something fresh to say and report every year. The Government is expecting statements to evolve and improve over time.
Naturally, it is imperative that if an organisation commits to doing something in a statement, it delivers it and produces evidence to support in years to come. Empty promises that pad out a statement will not position the business positively. Employers need to reflect on what is most relevant for them and their sector and demonstrate their progress against measurable objectives every year. Assigning the management of this to a specific team will ensure that this is a priority all year round and that the organisation stays on top of the issue as it evolves.
Effectively audit your supply chain
The guidance highlights the need for extensive due diligence of an organisation’s supply chain to be detailed in the statement, but offers little practical help on what this should look like. Despite this, an absence of audit leaves an organisation vulnerable to criticism, so it’s important employers establish a programme that appears to give more than lip service to auditing.
The best way a business can do this is by examining each of its suppliers holistically. Different industries will have different supply chain models and making the effort to speak to suppliers, industry organisations and charities to assess what should be measured and evaluated is the best way to ascertain what needs to be reported.
Demonstrate a robust reporting framework
It might seem obvious, but every statement should detail how individuals within an organisation and its supply chain can raise any potential abuses they discover or become aware of. This can be in the form of a help-line, email address, or relevant contact, as long as there is a safe way for those affected by slavery and human trafficking to reach out for help and advice if they need it.