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A Voice of Many: Modern Slavery Today
March 8th is International Women’s Day, and this year, we invite you to learn more about the realities of human trafficking and modern slavery that represent a sad figure of women impacted by these horrible crimes. By reading and sharing this story to help raise much-needed awareness to encourage governments, local authorities, companies, charities and individuals to do what they can to address the problem.
We start with Zimal’s story to illustrate the realities of modern slavery.
Thank you to Daria Toschi for this contribution.
I am Zimal and I have a dream.
Hi,
I am Zimal from Pakistan. I am 17-years old and one of the 15 million people employed in the textile industry in this country. Every worker in this industry has their own life and their own dreams, and today I want to tell you a little about mine.
I was given the name ‘Zimal’ by my friends who work alongside me in the factory. In our language, the word ‘Zimal’ is also used to describe a large piece of cloth that can be used to cover the entire body, hiding the wearer from view. Sometimes I feel like this name fits me well as I work each day invisibly in the same factory cutting and sewing glamorous clothes for people living far away who will never know me. For five years, I have entered the same turnstile each morning before dawn, not knowing what time I will be allowed to go home and each week not knowing if I will be paid the wages owed to me. If I speak up, nobody will listen, so I continue to be invisible and work to scrape together what little money I can to send back to my family.
Every month I sneak out of the boarding house to go to the market and rummage through the massive pile of second-hand clothes once loved by fashionable people in faraway countries. I rummage for hours in the hope of finding a few pieces for my sisters and me to proudly wear secretly at home when we play, “If I were free, I would wear…”
But I hardly find anything that is worth my pennies. The skirts, jackets, tops, sweaters, shoes, and accessories that make it here are usually so dirty that it would take a massive amount of soap, sweat, and tears to make them shine again. Besides, we are often not paid for our work, or if we are, then our money is taken from us to pay off debts that we took on to get work in the factory. Buying clothes for playing dress-up is not an option for us most months.
If I were free, I would buy every beautiful item and start my own business where we would take second-hand clothes that were once loved and give them a new life. My sisters and I would create stylish new pieces that so many others would want to buy. We would employ a workforce and give everybody fair pay and fair hours, creating freedom for many others who now live as I do, in fear.
So, this is my dream, to be invisible no longer.
But this opportunity seems far away from me now, as I am trapped working for an employer who will always want to control me and stop me from ever leaving this life.
For as long as I am in this situation, I am Zimal, the ghost-like girl who will keep rummaging at the Sunday market to keep herself alive with the illusion that, one day, she will create a new tomorrow for the women of her country.
It is my hope that by sharing this story, the many millions of people like me will someday become visible.
The Reality of Modern Slavery and How You Can Support
Stories like Zimal’s are the reality for millions of people across the globe who are trapped in modern slavery. People are exploited through debt, fear, and coercion and may often see no way out of their situation. However, the world has woken up to this issue, and there is a global drive to create workplaces that empower workers who are to be free from exploitation and abuse.
While it may be tempting to shift blame onto particular brands and industries for the existence of this issue based on one or two news articles or hearsay, many companies are engaged in positive action in this space that goes unnoticed.
At the Mekong Club, we work positively and collaboratively with companies who are striving to strengthen industries against modern slavery. This may be through putting mechanisms in place to ensure that workers can safely speak up about their conditions, training staff and suppliers on worker rights, and investing in community initiatives to support education and healthcare.
Take action today to support victims of human trafficking by sharing Zimal’s story. Consider donating and make a difference this International Women’s Day.
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Economic Terrorism: The Dark Connection between Scam Centres and Human Trafficking
The term “terrorism” often conjures images of violent extremist groups, political ideologies, and acts of mass destruction. However, it’s essential to recognise that terrorism can manifest in various forms, including those that are less apparent but equally as devastating. This blog post aims to shed light on the disturbing nature of human trafficking within scam centres and make a compelling case that the activities implemented by the criminal networks running these scam centres constitute acts of terrorism.
Part I: The Ties That Bind
To comprehend the link between terrorism and human trafficking within the scam centres, we must first understand the broader context of terrorism. Terrorism, at its core, involves the use of violence or coercion to achieve a political, ideological, and at times financial gain. While traditional forms of terrorism often involve large-scale attacks, the modern landscape has evolved to include activities that exploit the vulnerabilities of our global society.
Human trafficking is one such vulnerability. Defined as the recruitment, transportation, transfer, harbouring, or receipt of persons through force, coercion, or deception for the purpose of exploitation, it is a grave violation of human rights. Human trafficking can take place in various forms, including forced labour, sexual exploitation, and, as we will delve into further, involvement in scam centres.
Part II: Unmasking the Scam Centres
Workers travel to foreign destinations in response to job ads. They arrive only to find themselves caught in a trap. The vulnerable inbound workers have their passports taken from them and are forced into scam operations. These are scam centres run by human trafficking criminal networks. This is a new form of forced labour slavery called ‘forced scamming’.
Scam centres run operations designed to defraud individuals through deception, often involving impersonation, manipulation, and false information. These centres have proliferated, thanks to the anonymity provided by the internet and the development of telecommunication technology. While scam methods may differ from traditional acts of terrorism, their effects are no less devastating.
It’s important to highlight that there are two types of victims involved in this complex crime. First, there are foreign nationals from developing countries who are replying to fake recruitment ads published by the criminals. They are forced to work in the scam centres, defrauding people – the second type of victim – via deceptive schemes, such as romance scams, investment scams, etc.
Economic Terrorism: One facet of this crime encompasses the victims, often located in developed countries, who fall prey to deceptive schemes orchestrated by the victims of human trafficking. These individuals are defrauded, resulting in financial devastation that extends far beyond monetary loss. The consequences of such fraud can destabilise lives, leaving individuals in turmoil.
Psychological Warfare: A second dimension involves the victims of human trafficking who are recruited through legitimate job recruitment platforms and then coerced into participating in the scam centre operations. These victims endure not only physical abuse, but also severe psychological and emotional trauma. The toll on these victims is profound, leaving them in a perpetual state of anxiety, depression, profound distrust of others, and lacking legal protection for the acts of crime they were forced to perform, resulting in unjust prosecution in their home countries and abroad.
People for Profit: Within the sinister context of scam centres, an even darker facet emerges – the pervasive and malevolent crime known as ‘harmcore’. This disturbing practice exploits the victims of human trafficking, who have been enslaved into these fraudulent operations, becoming ensnared in an unrelenting cycle of exploitation that transcends the realm of financial scams. ‘Harmcore’ constitutes a disturbing form of terrorism in its own right, wherein these victims, forced to defraud other victims, are subjected to unimaginable acts of abuse and torture in front of the cameras. Videos capturing their anguish are ruthlessly sold to internet users for profit, perpetuating the cycle. Those subjected to ‘harmcore’ are often those who have underperformed in their scam activities, or have refused to participate, or have sought to escape from the clutches of the scam centres. This abhorrent crime, thriving within the heart of scam operations, represents a grave violation of human rights and demands our utmost attention and action.
(Source: Humanity Research Consultancy)
Part III: The Connection Revealed
Evidence that human trafficking within the scam centres is a form of terrorism can be seen when we examine the methods criminal networks use to “recruit” staff to perform the criminal activities.
- Human Capital: Criminals often recruit and employ recent graduate students or working professionals through legitimate job recruitment platforms or social media networks for overseas work. These individuals are coerced, manipulated, or forced into participating in these criminal enterprises till they’ve paid a ransom fee for their release, often exceeding US $10,000.
- Global Networks: Scam centres operate inside extensive global networks. The recruitment, transportation, and movement of individuals across borders are integral to their operations. Myanmar, where the rule of law has diminished due to the coup, is just one of many havens for these centres to openly exist. The transnational nature of this criminal activity mirrors the global reach of traditional terrorist organisations.
- Enabling Infrastructure: Just as terrorists require an infrastructure to plan and execute their attacks, scam centres rely on technological infrastructure, such as fraudulent investment platforms, telecommunication, and artificial intelligence, to avoid detection and to carry out their activities. These tools enable networks to reach out to victims worldwide, to recruit victims of human trafficking, and to defraud victims in order to amplify their impact.
Part IV: The Consequences and What is Needed
The consequences of overlooking the connection between human trafficking within scam centres and terrorism are dire. By failing to recognise these activities as acts of terrorism, we inadvertently downplay their significance and hinder the efforts to combat them effectively.
- Economic Destabilisation: The scale of money laundering stemming from these scams is reaching unprecedented levels, surpassing the funding available for addressing both terrorism and human trafficking combined on a global scale. Particularly alarming is the ease with which criminals operating in developing countries, where corruption may be rampant, can use the illicit gains from trafficking victims forced to scam, and from defrauding victims in developed countries, and use the profits generated to buy the silence and complicity of law enforcement officials, governments, regulators, and agencies, thus enabling the criminal ecosystem to continue its existence. This vicious cycle not only perpetuates the criminal networks but also poses a significant risk of destabilising entire economies. The influx of illicit funds can undermine the integrity of financial institutions, erode trust in government authorities, and exacerbate economic inequality, ultimately threatening the economic stability of a nation. The urgent need to combat the financial aspect cannot be overstated, as its unchecked growth could have dire consequences for the global financial system and the well-being of countless individuals.
- Legal Framework: Designating human trafficking within scam centres as terrorism would provide legal authorities with a more robust framework to pursue and prosecute these criminals. This could lead to more international cooperation in apprehending offenders.
- Resource Allocation: Recognising this connection would enable governments and organisations to allocate resources more effectively for the prevention of money laundering, targeting not only the symptoms but also the root causes of these crimes.
- Public Awareness: Increased awareness of the terrorist nature of these activities may empower individuals and communities to protect themselves, friends, and loved ones, thereby reducing the prevalence of victims of human trafficking within scam centres or of victims of fraud.
The connection between human trafficking within scam centres and terrorism is not a mere coincidence but a deeply intertwined relationship. Both are fuelled by greed, exploitation, and a disregard for human rights. By acknowledging the terrorist quality inherent in these activities, we can mobilise the international community to combat them with the urgency and seriousness they deserve.
Addressing human trafficking within scam centres as acts of terrorism requires a multifaceted approach, including legal reforms, international cooperation, and public awareness campaigns. Only by confronting this issue head-on can we hope to protect the vulnerable, bring the criminal actors to justice, and disrupt the networks that perpetuate these heinous crimes.
If you want to contribute to the solution, please consider donating to our crowdsourcing campaign for an international short film. This film aims to raise awareness and prevent more individuals from falling victim to false recruitment opportunities that lead to human trafficking within scam centres. Your support can make a significant contribution to protecting thousands of potential victims.
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Creating a Culture of Responsibility: Tips for Brands to Promote Anti-Slavery Practices Among Suppliers
As sustainability and ethical practices become more important for businesses, brands need to ensure that their suppliers are committed to these values as well. Modern slavery is a significant issue that affects many industries, and it’s crucial for brands to take a proactive approach in encouraging their suppliers to adopt anti-slavery practices.
Whether you’re new to addressing modern slavery or a seasoned advocate, this blog is designed to provide valuable insights and actionable steps for all levels of experience. From basic steps to get started, to recommendations for implementing your current strategies, we’ve got you covered.
To mitigate the risk of modern slavery from their supply chains, brands can take the following steps:
Firstly, raise awareness about modern slavery. Many suppliers may not be aware of the issue or the risks associated with it, so it’s important for brands to educate them. Brands can provide information about the forms of modern slavery, the risks associated with it, and the impact it has on individuals and communities. By raising awareness, suppliers will be more likely to take proactive measures to prevent modern slavery in their operations.
Secondly, promote ethical supply chain practices. Brands can encourage their suppliers to adopt ethical practices that promote transparency, responsibility, and accountability. Ethical supply chains help to ensure that products are produced and delivered in a way that respects human rights and minimises the risk of modern slavery. Brands can work with their suppliers to establish codes of conduct, policies, and procedures that promote ethical practices and reduce the risk of modern slavery. While this may seem daunting if you’re just getting started, there are various resources available to help provide direction in these areas.
Take for example The Responsible Sourcing Tool. This provides guidance and resources to help companies identify, prevent, and address human trafficking and forced labour in supply chains by providing templates for supplier codes of conduct, risk assessment tools, and training materials.
The Mekong Club also provides a range of comprehensive toolkits and resources which include practical guidance, checklists, templates and eLearning videos. The eLearning videos are complemented with quizzes to test suppliers’ knowledge in their own language. These resources are designed to assist brands in establishing ethical supply chain practices and reducing the risk of modern slavery.
Thirdly, provide anti-slavery encouragement and support. Brands can provide training on identifying and preventing modern slavery, share best practices, and offer incentives for compliance. They can also establish an effective grievance mechanism to allow workers to raise concerns about working conditions, including the risk of modern slavery, and seek redress for violations of their rights. It’s crucial for brands to work with their suppliers to establish an accessible, impartial, confidential, and responsible mechanism that is communicated effectively to workers in local languages and through multiple channels.
In addition to these steps, increasing supply chain transparency is crucial in preventing modern slavery in supply chains. Brands can work with their suppliers to provide access to information about suppliers’ operations, processes, and labour practices. This can include providing supplier audits, assessments, and other forms of monitoring to ensure compliance with ethical standards. Transparency helps to build trust between brands and suppliers, which is essential in creating a culture of responsible and ethical business practices.
An example of innovative technology that can increase supply chain transparency is the diginexApprise app. This multilingual app collects standardised, actionable data related to working conditions directly from workers in global supply chains. Through tailored question sets, companies can deploy surveys directly to workers in their supply chain on a variety of topics such as responsible recruitment, gender equality, and living and working conditions. This innovative approach has been recognised as an effective toolkit for companies looking to enable and scale proactive worker-led due diligence.
Finally, brands can collaborate with suppliers, industry associations, and other stakeholders to develop solutions for modern slavery. This can include sharing information about best practices, working together to address systemic issues, and promoting innovation in anti-slavery practices. The Mekong Club facilitates industry working groups that bring together key stakeholders to collaborate on specific sectors or issues related to modern slavery. These groups provide a platform for companies, NGOs, and experts to share knowledge, experiences, and best practices in a collaborative setting. Through these working groups, participants can identify and address common challenges, develop new solutions, and drive industry-wide change. By working together, brands and suppliers can help to eliminate modern slavery from their supply chains and create a more sustainable and ethical business environment.
Eliminating modern slavery from supply chains requires a multifaceted approach that involves raising modern slavery awareness, promoting ethical practices, providing anti-slavery encouragement and support, increasing supply chain transparency, and collaborating on solutions. By taking these steps, brands can create a more responsible and sustainable business environment and help to end modern slavery.
Author: Nolan Clack
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Child Slavery: Definitions & Tools for Understanding This Global Crime
Children make up around 25% of victims of modern-day slavery, with millions of children being forced to work in global supply chains daily. Addressing forced, and child labour is a key priority area for many companies, who make public commitments to a zero-tolerance approach and point to programmes to eradicate child labour across their supply chains.
However, as with much terminology in the modern slavery space, there are conflicting perceptions of what constitutes exploitation of children and subsequent challenges posed in implementing child labour policies globally. For example, there are different ways to classify the terms ‘labour’ and ‘child’ depending on local context, which can lead to confusion and misconceptions about the risk of exploitation. Anti-slavery International provides the following useful breakdown of common terms that provide some further clarity on the spectrum of this issue:
- Child work. Some types of work positively contribute to a child’s development, helping them learn useful skills. Often, this work is also a vital source of income for their families.
- Child labour. Child labour is not slavery but nevertheless hinders children’s education and development. Child labour tends to be undertaken when the child is in the care of their parents.
- Worst forms of child labour.“Hazardous work” is the worst form of child labour. It irreversibly damages children’s health and development through, for example, exposure to dangerous machinery or toxic substances, and may even endanger their lives.
- Child slavery. Child slavery is the enforced exploitation of a child for someone else’s gain, meaning the child will have no way to leave the situation or person exploiting them.
- Child trafficking. Trafficking involves transporting, recruiting or harbouring people for the purpose of exploitation, using violence, threats or coercion. When children are trafficked, no violence, deception or coercion needs to be involved; trafficking is merely the act of transporting or harbouring them for exploitative work.
“Universally agreed and legally binding rights of the child are enshrined by the UN. Yet, while international standards are clear the reality in countries is too often different.” Cindy Berman, ETI
Where is Child Slavery & Child Trafficking Found?
Sadly, the exploitation of children in this way impacts many different industries worldwide. According to UNICEF, it is expected that Covid-19 may further exacerbate this prevalence as more people are pushed into poverty and find themselves in increasingly desperate circumstances.
Some useful resources to assist with mapping the risk of child exploitation within supply chains include:
Mekong Club Modern Slavery Risk Map
This map brings together a range of public modern slavery data sources into one place as an interactive tool that can be searched by country and/or commodity. It includes data taken from the Department of Labour’s List of Goods Produced by Child or Forced Labour. Select the commodity you are interested in understanding more about and read the ‘Commodity Report’ to learn about child labour in each industry.
Source: Mekong Club Modern Slavery Risk Map (Commodity Report)
This website has many different maps and charts showing different child trafficking and labour datasets. You can see the average hours worked by children on a country level or the breakdown of child labour cases by age and whether they go to school in addition to working.
Source: Our World in Data (World Bank Dataset)
How can I understand the legal framework?
The Mekong Club has recently launched a new tool, the ‘Child Labour Law Toolkit’. This tool is available on our toolkits page for all Mekong Club members.
The tool outlines key information that companies need to know related to child labour in key sourcing locations. You are able to select the country that you are interested in learning about, to access the following information:
- Legal framework and relevant laws related to child labour
- How businesses are affected by these laws
- Requirements on businesses in order to be compliant
- Penalties for non-compliance
- Notable prosecutions
A snapshot from the Toolkit (for sourcing in India)
If you wish to access this tool or learn more about membership, contact [email protected].
About The Mekong Club
The Mekong Club works with the private sector to bring about sustainable practices against modern slavery across the globe. Companies can join the Mekong Club as members to enjoy a range of benefits, anti-slavery tools, resources, and consultations. We have created a community of like-minded peers across different industries, working together to address modern slavery. Through these efforts, our mission is to inspire and engage the private sector to work together towards creating a slave-free world.
Author: Phoebe Ewen
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What To Know About the European Union’s Corporate Sustainability Due Diligence Directive (CS3D)
Human rights and corporate sustainability due diligence are topics that have continued to gain traction and visibility over the past few years. Most recently, the European Union’s Corporate Sustainability Due Diligence Directive (CS3D) was approved in June 2023, marking the first international due diligence imperative applicable to all major enterprises based in or generating significant turnover within the EU.
As a business, it is crucial to understand the new requirements introduced by CS3D and implement the necessary steps to prepare for compliance. What is the impact of CS3D for companies and their suppliers? How can companies take steps to meet the expectations of the directive, and what are the penalties for non-compliance? This article will seek to break down the details of CS3D and highlight the importance of this new directive for businesses and workers worldwide.
According to the European Parliament, the creation of the CS3D is part of the European Union’s transition towards a climate-neutral and worker-oriented economy, in line with the environmental and human rights objectives of the EU Green Deal and United Nations Sustainable Development Goals. While various other policies are being implemented within the EU to address these goals, the CS3D was created while cognisant that most of the adverse impacts of EU consumption and business practices are outside of the Union in the global supply chain. By codifying international standards for due diligence that companies previously undertook on a voluntary basis, the CS3D aims to provide legal certainty for enterprises and ensure remediation for victims of harm across the board. The new baseline of compliance requirements will level the playing field for all Member States of the Union, avoiding fragmentation while simultaneously advancing respect for human rights and environmental sustainability across sectors.
The process began with a proposal by the European Commission in February 2022. In November 2022, the European Council established its negotiating position and approach for the CS3D. Subsequently, the Committee on Legal Affairs voted on their amendments to define the European Parliament’s position in April 2023, which was adopted by the European Parliament in June 2023. Interinstitutional negotiations on the CS3D can begin among the European Parliament, the European Council, and the European Commission. The formal adoption of the CS3D is not anticipated before 2024. Once it is formally adopted, Member States will have two years to incorporate the CS3D into their national legislation.
The CS3D applies to several main groups of large enterprises. Group 1 enterprises include companies based in the EU with 500 or more employees, while Group 2 enterprises include companies based in the EU with 250 or more employees. These companies must generate at least EUR 150 million net turnover worldwide in both cases. The CS3D also includes third-country companies, generating EUR 150+ million and EUR 40+ million net turnover respectively, within the union. The directive also covers companies operating within and/or generating significant turnover in defined high-impact sectors, such as agriculture or mineral extraction.
The directive outlines expectations for companies to conduct risk assessment within their value chain and accordingly develop due diligence processes, subject to annual review and update. Similar to other legislation of this kind, public communication and reporting on due diligence efforts is mandatory. One main area of focus for the directive is the integration of due diligence processes into management systems. Issues should be addressed where they arise, and companies must proactively adopt policies that aim to prevent or mitigate adverse human rights, environmental, and/or governance impacts.
Additionally, companies must establish operational grievance mechanisms for workers and stakeholders in their supply chain to report concerns and submit complaints. A key mechanism for engaging workers’ voices, grievance mechanisms are an effective tool that provides insight into the impact of policies on actual working conditions, acting as a litmus test for companies. Grievance mechanisms are also vital in providing access to appropriate remedies for affected workers and stakeholders, which companies must cooperate with in line with the directive. Effective grievance mechanisms should be confidential, impartial, and accessible to workers, especially high-risk and vulnerable groups.
Enforcement will be conducted on the Member State level, with potential administrative and civil penalties. Administratively, each Member State of the EU is compelled to set up a regulatory authority to impose monetary fines and compliance orders. Members of the public are encouraged to submit complaints of alleged violations to these regulatory bodies. Furthermore, Member States will ensure that victims will receive compensation for harm incurred by a company’s failure to comply with their due diligence obligations, making companies liable to civil suits in the event of non-compliance.
While the impact of CS3D is readily apparent for companies, it is important to note the effects on suppliers and workers worldwide. Due to the global nature of supply chains, the sweeping nature of an EU-wide due diligence directive will affect suppliers worldwide as their client companies likely fall under the jurisdiction of CS3D. The company is expected to undertake the majority of the burden of the new requirements, as the directive includes measures limiting the burden’s passing onto smaller suppliers in the value chain. However, as CS3D marks another milestone in the increasing rigour of due diligence imperatives, suppliers are also expected to take proactive steps to bring their operations up to international standards. Suppliers violating human rights and environmental guidelines may find their business relationships at risk as companies come under increasing pressure to address adverse impacts in their value chain.
In conclusion, the EU’s Corporate Sustainability Due Diligence Directive is an important step towards holding companies increasingly accountable for the human rights and environmental impacts of their business practices and sets new standards for due diligence obligations. As the directive comes into force, it is imperative for companies and suppliers alike to understand the new expectations and take the necessary steps to ensure compliance.
Author: Alice Bai
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Overcoming Economic Challenges in Addressing Human Trafficking
Struggling to manage expenses during economic challenges?
The Conference Board predicts a 96% probability that the United States will enter a recession within the next 12 months. It indicates a potential global economic downturn. If this happens, businesses may face reduced profits, a credit crunch, and lower cash flows.
While cutting expenses is a common strategy, it is time to think ahead. With expanding transparency legislation, companies can’t afford to ignore the ramifications of modern slavery in their business anymore. Failure to maintain a moral company also means losing ethical customers and talents.
As recent trends in HRM show, companies that invest in their people during downturns are more likely to be profitable than those that downsize for cost-cutting reasons alone. The Mekong Club has over 10 years’ experience providing guidance in crisis management for its members. This blog aims to help make sound investments during economic challenges. We will first introduce anti-slavery strategies for higher compliance, efficiency, and profitability. Then we discuss how these techniques can be applied.
What is anti-human trafficking during an economic downturn?
- Forceful compliance management for increasing modern slavery risk in economic challenges
Research has proven that economic shocks would skyrocket modern slavery risk. Partially due to the pandemic, in the last five years, 10 million more people have been victims of modern slavery, on top of the 40 million from the previous report. We expect the number to rise further due to the impending economic downturn.
Internal and cross-border human trafficking could arise during an economic downturn. The job loss trend could provide unscrupulous traffickers with more desperate victims. Given intense job competition, mushrooming workers may travel to seek better opportunities. Migrant workers confront poverty, discrimination, unemployment, and limited access to essential services. As a result, these workers may accept lower-paying and exploitative jobs and pay recruitment fees. Considering that businesses have countless workers, they are vulnerable to forced labour risk during the downturn.
Anti-human trafficking is critical for compliance and avoiding fines during economic downturns. The new German Supply Chain Due Diligence Act is now in place. Hence, businesses are subject to more significant legal risks. The law requires firms to issue a policy statement on human rights strategy and introduce preventive measures. It allows for fines of up to EUR 800,000, or up to 2% of a business’s average global turnover. Companies also may be barred from participating in public tenders if their fine exceeds EUR 175,000. Considering heavy penalties for non-compliance, businesses should beware of the growing modern slavery risk during the economic downturn.
- Streamline the process of managing modern slavery risk
Businesses demand performance guarantees and quick ROIs within tight budgets. During the 2020 recession, 244 large companies filed for bankruptcy. Accordingly, maintaining revenue and cutting costs to minimise profit loss is a top priority for surviving during economic challenges.
What technology adoption is suitable for conquering this challenge? AI can boost productivity. A study by Accenture reveals AI will allow people to save time, increasing productivity by 40%. AI solutions can free up your team members for more strategic tasks and improve output and accuracy. Additionally, employees may be overwhelmed by their daily tasks during economic layoffs, posing a pessimistic atmosphere at the workplace and lowering productivity. Introducing AI can relieve employees’ burdens and increase their morale. More than two-thirds of employees are pleased with how AI has aided them in their work, which maintains employee retention. AI can save time, reduce turnover costs, and refine productivity during a potential recession.
AI not only provides a benefit in the short term but is also crucial to long-term development. It’s common to neglect the long-term during an economic downturn, but AI can benefit both. LinkedIn co-founder Reid Hoffman said, “You are sacrificing the future if you opt out of AI completely.” Infosys also states that 76% of enterprises believe AI will be fundamental to their future success. Although there’s still a large adaptation before most organisations implement these technologies, consider acquiring AI for the future success of your company.
AI is instrumental in identifying modern slavery via automation, which strengthens efficiency. For example, financial institutions can leverage AI’s anomaly detection to identify patterns in financial flows. Transaction analysis within banks designed to catch money laundering can miss small flows of money taken from bank accounts in the victim’s name, often with repeat visits to a local ATM. KYC checks combining AI can also more accurately detect deception and exploitation when traffickers open bank accounts on behalf of the victim. Furthermore, integrating workers’ voices and AI can identify individuals from ambiguous and sparse datasets when taking social audits on supply chains. It can detect red flags of exploitation, such as unusual numbers of employees sharing the same address or bank details. AI can allow brands to recognise, predict and unlock new insights into modern slavery at a much higher efficiency, and we hope that these technologies will be more widely available in the near future.
- Retain ethical and loyal customers to secure revenue.
Companies should prioritise enticing existing customers during a potential downturn. Many businesses trim their marketing and advertising budgets to save money. Therefore, you need to be vigilant about how to use your resources. Interestingly, 65% of a company’s business comes from existing customers. Instead of attracting new customers, focus on using the money to nurture your existing customer base. They will likely continue to purchase your products and services and contribute to continuous revenue.
If your company sells ethical products, continue and expand your moral marketing efforts. Consumers who already pay a premium for ethical goods like Fairtrade and organic produce are unlikely to be deterred by a slowing economy. Because consumers have stronger ties to ethical brands, they are able to charge more than their unethical counterparts. Consequently, ensure that principled customers are pleased with your product or service offerings.
Even if raising ethical standards is not a priority, it’s important to be aware of the consequences and risks related to modern slavery and business. Provided customers learn that a company supports an issue that contradicts their beliefs, 76% will refuse to buy its products or services. The loss can be substantial for brands that have customers in the United States. 90% of survey respondents in the United States said irresponsible business practices would cause them to boycott a brand. Maintaining a good reputation among customers during difficult times is essential.
How to achieve anti-human trafficking strategies
- Modern-day slavery training
Modern slavery training is vital to building company-wide awareness and capacity building for compliance management. As this crime is ever-evolving, up-to-date training is necessary for effective action against modern slavery risk. Consider inviting a commercially aware and knowledgeable anti-human trafficking organisation to conduct the training. Solid modern slavery training can allow companies to learn new risks and trends for modern slavery compliance. Also, it enables employees to recognise and report modern slavery. By instilling modern slavery awareness into employee training, their confidence in reporting anything suspicious would inevitably be enhanced. Modern-day slavery training can thus tackle alarming legal and modern slavery risks.
Proper modern slavery training should be:
- Informative and role-specific to engage the audience
- Mandatory for all employees with modern slavery risk exposure
- Refreshed regularly to ensure knowledge retention and to account for new information and trends in modern slavery
- Complemented with e-learning to deliver it to the whole supply chain
Every industry has its crucial issues to focus on in modern-day slavery training:
Finance:
When combating modern slavery in the financial sector, anti-money laundering is always the primary focus. A solid anti-human trafficking strategy, however, is not the sole responsibility of a single person or team within any financial institution. Consequently, financial institutions should focus on the following issues in training:
- The anti-money laundering compliance officer should learn to include modern slavery risk factors and typologies.
- When a customer visits their branch, the customer relationship manager and branch staff should be able to detect suspicious activity.
- Property and procurement teams must understand how to use modern slavery risk indicators and assess supplier risk.
- To identify which investees are making better progress in addressing modern slavery, ESG analysts must learn how to read a modern slavery statement critically.
Hospitality:
Aside from handling modern slavery in supply chains, hotels can protect sex trafficking victims and face legal risks for not doing so. Hotel rooms are frequently used for sexual abuse by traffickers due to the transience and anonymity of hotel customers. With human trafficking being a concealed crime, it’s in the organisation’s best interest to ensure there’s training for housekeeping, reception and security staff in indicators of sex trafficking and reporting. Watch the below video to learn more.
Supply chains:
All managers, employees, and subcontractors should receive training. E-learning is an excellent tool for providing training in the workers’ native languages. Training on supply chain management should also incorporate the following:
- C-suite level and board members of brands and retailers must understand the role their business can play in addressing modern slavery in their extended supply chains.
- Buyers should be aware of the impact of purchasing practices on working conditions in production units.
- Compliance managers must be aware of modern slavery to establish and maintain anti-slavery policies and procedures.
- Supplier factory owners or subcontractors must be aware of the risk of modern slavery and its consequences.
- Workers should understand the risks of borrowing from their employers to reduce debt bondage.
- Social auditors should be trained to use technology for social audits or understand ILO forced labour indicators to ask the right questions.
Free modern-day slavery training
The Mekong Club has prepared Modern Slavery Introductory Training videos for supply chains in the finance and hospitality sectors. Please feel free to share with your colleagues to enhance modern slavery awareness.
- Addressing the risks of modern slavery with the use of technology
One issue with modern slavery is the ever-changing and hidden risk. In an economic downturn, cryptocurrency and climate change can fuel new modern slavery typologies. Traffickers and abusers are also adept at concealing modern slavery by switching tactics. What makes matters worse is the scarcity of data. Hence, handling modern slavery risk is costly for businesses.
STOP THE TRAFFIK, IBM and Clifford Chance LLP collaborated to create the Traffik Analysis Hub (TA Hub) to tackle this complexity. TA Hub aims to unveil a trafficker’s typology via survivor stories. Instead of relying on tracking money flows, it compensates and enriches data with survivor stories. TA Hub converts credible data from survivors into trafficking patterns and hotspots.
How does it work? The AI and natural language processing (NLP) extract people involved, how it operates, and what enables or constrains it. While the data from the survivor story is accurate, it may be low in volume. For this reason, the Hub complements it with negative news and other data sources. 100+ organisations have joined using this technology and share data in a non-competitive and secure environment.
You can use analytical tools to transform the data into helpful insights. The tools are highly customisable, and include map analytics and a dashboard. This comprehensive data enables companies to fix potential issues, prevent modern slavery risk, and enhance their ESG profile.
How? To reduce third-party risk, you can identify rogue contract labour providers on TA Hub. AML professionals can use this technology to identify the typology of modern slavery. Law enforcement agencies can enhance their investigations of suspects, victims, and the infrastructure used in victim trafficking and exploitation. Businesses can conduct intelligence-led supply chain audits to increase customer confidence that their products are slave-free. By doing so, it also ameliorates a company’s ESG report with greater efficiency in preventing modern slavery.
- Ethical Marketing
When promoting a product, service, or brand in a way that is consistent with your company’s values and morals, you engage in ethical marketing. Marketing efforts should not exaggerate claims and practise complete transparency and openness. So how can you engage in ethical marketing?
First, examine your business environment, segmentation, demographics, and customer personas in relation to your SDGs and ESG metrics. You will quickly identify the most common moral values of your customers.
Then, align your company’s mission and vision statements with UN sustainability goals representing your brand and your customers’ ethical values.
Finally, leverage what has been discovered and apply it to your communication strategies. For example, demonstrate your ethical practices and be vocal about social and moral issues on social media. Ethical marketing emphasises your brand with a strong sense of social responsibility that customers want to support.
Conclusion
With the impending economic challenges, consider addressing the current risk while planning for the future. Implementing anti-human trafficking practices can help improve compliance, cost-cutting, and revenue. Joining modern-day slavery training, using tech tools to address risks, and developing an ethical marketing strategy are all ways to achieve them. To continue staying ahead of the curve, sign up for our mailing list for the latest news and events here.
Author: Tsz Yin Wong
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8 Tips for Brands on Germany’s Due Diligence Act
The passing of Germany’s new corporate supply chain due diligence law has raised many business questions and concerns. The law requires companies to take proactive measures to prevent human rights violations and environmental damage in their global supply chains, and non-compliance can result in significant fines and reputational damage. As a business owner or manager, it is essential to understand the law’s requirements and take the necessary steps to prepare for compliance. How can companies assess the risks in their supply chains and develop a compliance plan? What steps can be taken to engage with suppliers and monitor progress?
We’ve compiled a list of practical tips for businesses for Germany’s Due Diligence Act:
1. Develop a due diligence process: Establishing a comprehensive due diligence approach will help you address human rights and environmental risks in your supply chain. As per the UN Guiding Principles on Business and Human Rights, the due diligence process consists of identifying and assessing actual or potential adverse human rights impacts, integrating findings and taking appropriate action to address the impacts, tracking the effectiveness of measures implemented, and communicating how risks are being addressed. This system should involve many departments within your business, such as risk, procurements, human resources, ESG, audit and communication. The Human Rights Due Diligence process represents an important step for companies to ensure their supply chains are responsibly managed and aligned with sustainability principles and ethical behaviour.
2. Mapping and risk assessment: A crucial step for preparing for the Due Diligence Act is to assess risks. To understand the risks, it is essential to get a full picture of your supply chain. Supply chain mapping involves engaging with your suppliers to gather information on who they are, where they operate and who they work with. To prepare for Germany’s Due Diligence Act, companies should identify key suppliers and stakeholders and assess country-level, sector-level and commodity-level risks as well as the exposure to specific risks such as modern slavery. A comprehensive risk assessment should set up monitoring and reporting systems to address potential and actual adverse impacts on human rights and the environment. You can use tools such as the Slavery & Trafficking Risk Template (STRT) or the Anti-Slavery Scorecard to help you assess modern slavery risks in your supply chain.
3. Establish a complaints procedure: To establish a grievance mechanism, you should identify and communicate clear channels for employees and stakeholders to report concerns or complaints related to environmental and human rights violations. It is important to ensure that these channels are accessible, confidential and responsive. Additionally, companies should appoint a dedicated team to handle and investigate complaints and implement measures to protect whistle-blowers from retaliation. Regular training and awareness-raising for employees, suppliers and other relevant stakeholders are also crucial to ensure the success of the grievance mechanism.
4. Engage with suppliers: Engaging with your suppliers is essential in ensuring they know the Due Diligence Act and the requirements for compliance. You should communicate the expectations for compliance to your suppliers and provide them with the necessary resources and support to meet those expectations. The Mekong Club is developing a supplier toolkit to support brands’ supplier engagements. To stay up to date on the tool launch and to receive regular modern slavery updates, subscribe to our email newsletter.
5. Train employees: Training your employees on the Due Diligence Act and your company’s due diligence plan is crucial in ensuring that they understand the requirements and can implement the necessary measures in their daily work. This can include training on human rights and environmental issues and how to identify and address risks in your supply chain. Mekong Club members have access to our e-Learning platform, which provides brands and their suppliers with educational videos on modern slavery, reading resources, and quizzes in multiple languages to test knowledge.
6. Monitor progress: Regular monitoring of your supply chain is essential in ensuring that you are meeting the requirements of the Due Diligence Act and making progress towards a more responsible and ethical supply chain. This may include regular audits, inspections and assessments to assess compliance and identify areas for improvement. Solutions such as diginexApprise are a great way to overview your supply chain comprehensively.
7. Report progress: The Due Diligence Act requires companies to publicly report on their progress in addressing the risks in their supply chains. This may include annual reports or sustainability reports that outline the measures that have been taken to prevent human rights violations and environmental damage. When a new member joins the Mekong Club, we run a baseline assessment through a methodology we developed over the years. The assessment enables us to better understand how our members are doing in their anti-slavery efforts and the areas of improvement we can work together to customise an anti-slavery roadmap strategy that aligns with companies in their anti-slavery efforts.
Continuously improve: Finally, it is important to constantly improve and make changes as needed to ensure that you meet the Due Diligence Act requirements and that your supply chain is responsible and ethical. This may include regularly reviewing and updating your due diligence plan, engaging with stakeholders and making necessary changes to your supply chain. As a nonprofit, we often get asked how NGOs and companies can work together. The private sector and NGOs sometimes speak different languages and may even have hostility towards each other. However, we believe addressing modern slavery will ultimately require partnerships between these two groups, as NGOs have the data and information the private sector needs to address modern slavery.
In conclusion, the Due Diligence Act is an important step forward in holding companies accountable for their actions and ensuring they are responsible and ethical in their business practices. As an organisation, it is crucial to understand the new law’s requirements and take the necessary steps to prepare for compliance.
Author: Nolan Clack
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How to Improve your ESG Investing: Powerful Partnerships for Sustainable Development Goals
“If you were to add a letter to ESG, what would it be?”
Without hesitation, the Mekong Club CEO, Matt Friedman, answered “P” for partnerships to introduce ESG(P).
Why?
Partnerships can improve ESG investing.
ESG investing trends have been mushrooming. According to a new Bloomberg Intelligence report, global ESG assets may exceed $41 trillion by 2022 and $50 trillion by 2025, accounting for one-third of total assets under management globally. Growing ESG future assets’ value indicates that they will be a significant asset class that all sustainable investors and financial institutions should now consider.
Yet, one challenge with ESG investing trends is the wide disparity in human rights ESG. While environmental and governance ESG metrics are well-established, social ESG metrics fall behind. There are no established criteria for assessing social factors associated with modern slavery.
Another hindrance is that ESG is company-centric. It evaluates individual organisations without emphasising their collaborative efforts. While some ESG indexes emphasise an organisation’s involvement in multi-stakeholder efforts, they play a minor role in the ESG framework. Endorsement and participation in sector-wide efforts are material enough to warrant consideration.
How to solve these issues?
The synergistic, unified, sector-wide partnership to integrating SDGs into ESG can help close the gap and bring up human rights ESG. The Business and Sustainable Development Commission estimates that achieving the United Nations SDGs will generate $12 trillion in market opportunities, attributing to around 60% of the global economy. Achieving SDGs’ enormous value reveals its profitability and potential.
The Mekong Club is at the forefront of standardising the modern slavery part of ESG social metrics in ESG investing. For example, in 2021, we held four events to amplify the ‘S’ in ESG, reaching 2,173 ESG data providers, sustainable reporting agencies, and asset managers.
And here’s what we came up with to achieve ESG(P) immediately.
Why integrate SDGs in ESG investing?
Linking SDGs and ESG investing trends can cultivate cross-sector collaborations and engagement, which benefits everyone. The linkage also provides you with direction to ESG social metrics.
Collective actions among prominent stakeholders such as governments, the United Nations, academic institutions, and civil society have been a hallmark for tackling SDGs. The SDGs are a collection of 17 interconnected global goals designed to be a “blueprint for achieving a better and more sustainable future for all”. The United Nations General Assembly established the SDGs in 2015 to reach them by 2030.
Yet, the SDGs were for policymakers and governments at the national level without emphasising private-sector partnerships.
One complexity of multi-sector synergy is that businesses need more incentives to engage in sustainable practices. Companies may regard sustainability as a “nice to have” for risk prevention and compliance but not a “must have” because it places little stress on the upsides of doing so.
To bring SDGs to the corporate level, we must combine them with ESG. ESG is a concept of active risk management that is financially relevant and can provide numerous long-term benefits to the company. Examples of advantages are employee and customer retention, access to ESG capital and cost savings. ESG also offers a tangible, measurable, comparable index that can reflect a company’s positive impact. Integrating with ESG can convert SDGs into a common goal to unite government, civil society, business, the United Nations, academic institutions, financial institutions, and public investors.
Merging SDGs goals into ESG investing would be a win-win for the world. Companies can enjoy stable profits and capital by engaging in human rights ESG. Investors and financial institutions can earn a long-term return by chasing ESG investing trends. Governments can help to promote long-term development that benefits the entire economy.
How to include SDGs in ESG investing?
Amplify ESG social metrics by integrating the SDGs structure into ESG indicators. We can create business indicators or KPIs of contribution to SDGs. Incorporating these indicators and KPIs into ESG investing indicators can enhance ESG social metrics measurement.
To combine SDGs into ESG social indicators, we must first understand the Modern-slavery-related SDGs for ESG social metrics:
- 2 Eliminate all forms of violence against all women and girls in public and private spheres, including trafficking and sexual and other types of exploitation.
- 7 Take immediate and effective measures to eradicate forced labour, end modern slavery and human trafficking and secure the prohibition and elimination of the worst forms of child labour, including recruitment and use of child soldiers, and by 2025 end child labour in all its forms.
To formulate the two SDGs into the ESG investing framework, we apply BlackRock’s investment framework to measure SDGs in relevance, completeness, and prioritisation to improve ESG investing:
- Relevance: To transform national goals into business indicators, we offer the below framework relevant to staff, procurement, recruitment, supply chain procedures and leadership efforts in anti-slavery.
- Completeness: Our framework includes multifaceted tangible and measurable human rights ESG practices to follow the completeness principle.
- Prioritisation: Our framework prioritises strengthening the impactful part of the business by focusing on supply chain sustainability, which is critical to a company’s success and reputation. Furthermore, the two SDGs are crucial to our economy, as the current and projected costs of inaction on gender equality and worker-related hazards are 18.5% and 3.9% of global GDP, respectively.
So what are the criteria of our ESG investing framework?
1. Every action begins with awareness, so the first criterion is Understanding. Companies should have materials, training, and capacity building for all stakeholders in the company, including staff, suppliers, and contractors, to improve organisational knowledge about modern slavery.
2. Knowledge is futile without action, whereas commitment is the first step toward action. So Commitment is the second criterion. Implementing supply chain policies and standards visible within the company and the public can foster company-wide dedication to modern slavery. Many businesses use third parties in their supply chains, but risks arise when things are hidden in plain sight. Therefore, practical supplier policies and contracts with standards are essential to guarantee slave-free supply chains.
3. The next step in demonstrating commitment is to take action—are businesses achieving their promises to end modern slavery? Because many companies only examine tier 1, our framework encourages businesses to be consistent in detecting modern slavery risks in different tiers of supply chains. Additionally, once they identify risks, they should have remediation practices enforced.
4. Businesses that go above and beyond to be leaders in the fight against modern slavery attract loyal customers who can help them achieve long-term success and sustainable development. Corporations should engage with NGOs, counterparts, customers, and others to promote comprehensive actions to end modern slavery.
The ESG concept and framework must be flexible and open to revisions. The flexibility would offer an increased, real-time impact on our collective desire to improve our world.
In conclusion, you need to pay attention to skyrocketing ESG investing trends. To sharpen ESG investing, we must strengthen partnerships, bridge the gap in human rights ESG, and develop social metrics ESG. Including the SDGs in the ESG framework is a perfect solution to ascertain the effectiveness of ESG investing.
Now we want to hear from you:
What do you think about integrating SDGs into the ESG investing framework? Let us know in the comment section below.
Want to receive personalised advice on how your financial institution can create an ESG framework that eases modern slavery? Contact us for a no-commitment and expert consultation here.
Authors: Matt Friedman and Tsz Yin Wong
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Help Stop Modern Slavery this Holiday Season
As the holiday season approaches, and many of us take time off work to reflect on the year, and reconnect with friends and family. This season for many, is a time for gift-giving, celebration, and charity. During this time, there are many opportunities to take action against modern slavery, the seemingly smallest action can make a big difference that lasts far beyond the holiday season. The following are some examples of how you can combat modern slavery during this time.
Make a Resolution
New Year’s Resolutions, from going to the gym more to watching less TV are frequently made and easily broken. By making a meaningful New Year’s resolution for 2023, you can challenge yourself with practical actions that not only enrich your life but contribute to making the world a better place. You could resolve to dedicate 8 hours a month to volunteering, fundraise a certain amount for your favourite NGO, or educate 100 people in your life about modern slavery. You could even pledge to set up a club at your school or a working group at the office to get your peers involved. These kinds of resolutions will one day allow you to reflect on 2023 knowing you have helped to prevent modern slavery and save lives, an incredibly motivating outcome!
Volunteer
Local NGOs are always seeking support, and you may be surprised at how in-demand your skills are. This support is needed during the holiday season and beyond with thousands of anti-slavery NGOs that need help. Support varies from practical work on the ground to help vulnerable people during the holiday season through to jobs that can even be done remotely, like fundraising, writing, website maintenance, accounting, marketing, and legal support. Taking some time to research and speak to modern slavery NGOs and charities will show you how useful your skills and time can be, and may lead to a newfound passion project in 2023.
Shop Thoughtfully
As you are buying gifts for friends and family, make a conscious effort to choose companies and brands that are actively engaged in prevention of modern slavery. Positive reinforcement demonstrates to companies that consumers care about modern slavery, and encourages positive action. Apps like Good On You allow you to research how your favourite brands are working on modern slavery issues and understand how they are combating this crime, with recommendations for ethical retailers. Most organisations (particularly those that operate in the UK and/or Australia) are legally required to publish a publicly available modern slavery statement on their website that you can access. Take a look at your favourite brands’ statements, and read about the work that they are doing. Reward those brands that are taking action by choosing them for your gift-giving this holiday season.
Gift a Donation
Consider making a donation to an organisation working against modern slavery, either for yourself or as a gift to a friend or family member. A gift of a donation not only brings joy to the gift giver and receiver, but also to great joy the organisation and beneficiaries that it supports. In a year where NGOs fight to survive the impacts of Covid-19, and modern slavery is affecting even more vulnerable people, a donation gift has more meaning than ever.
Consider donating this holiday season to help prevent and identify victims of human trafficking by following the link.
All of the above actions are simple but significant steps that can be taken to prevent modern slavery this holiday season. Share this article to encourage your friends and family to do the same, and help end modern day slavery!
Author – Phoebe Ewen
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4 Things to Know About Modern Slavery Risks in Shipping to Carry Out the 3 Steps Toward Supply Chain Sustainability
When detecting modern slavery risks, one that often goes unnoticed is the risk in the maritime supply chains. Many businesses outsource this function and, thus, may need to learn the employment situation within their supply chain.
Given the high volume of workers required for loading, unloading, repairing, and other daily tasks in shipping, the vast and complex supply chain is vulnerable to modern slavery risk. Suppliers may overlook workers’ human rights when trying to cut costs to deal with the recession on a tight budget.
Yet, shipping is an essential component of the supply chain for transporting freight, accounting for 90% of global trade. Despite its importance, supply chain workers face severe exploitation, jeopardising a company’s supply chain sustainability.
The Mekong Club has spent a decade developing solutions and tools to end modern slavery in supply chains. And here are four things you should know about modern slavery risk in shipping before taking the following three steps to ensure supply chain sustainability.
Let’s dive right in.
OVERVIEW OF MODERN SLAVERY RISK IN SHIPPING
- What is modern slavery risk in shipping?
Shipping modern slavery risks occur when many seafarers are exploited and abused—for example, extended working hours, fraudulent employment contracts, low pay, and a lack of food and drinking water.
The worst-case scenario is abandonment. It involves the shipowner leaving the seafarers without contact, money, food, or transportation to home.
- Why is the prevalence of modern slavery risk in shipping?
The shipping industry can enjoy less stringent regulations using flags of convenience (FOC), which enhances the modern slavery risk. FOC-registered vessels sail under a foreign flag.
For example, a ship can be registered in Liberia, owned by a Greek company, chartered by a Chinese company, and crewed by Filipinos. It’s challenging to track down each of these parties and determine who is to blame for any transgressions.
Most ship owners register their vessels under a FOC. FOC provides minimal regulation, preferential registration fees or tax benefits, and the ability to hire labour anywhere in the world. As such, ship owners may leverage FOC to use migrant workers and exploit them.
These migrant seafarers lack access to information about their rights and may not speak the local language. They face significant challenges in determining what slavery is and how to report it. They also work in isolated conditions, away from friends and family, making it difficult to receive support and escape.
- Where are modern slavery risks in shipping?
The modern slavery risk in shipping exists all over the world. The Australian Maritime Safety Authority (AMSA) has recently prohibited bulk carriers flagged in Panama, Liberia, Hong Kong, and Singapore, though many cases remain unidentified.
AMSA banned these ships for underpaying or failing to pay their seafarers. These ships also violated other Maritime Labour Convention (MLC) involving working conditions, accommodation, food and medical care and other rights.
- Why care about modern slavery risk in shipping? Simple. Supply chain sustainability.
Supply chain sustainability is essential to help your business thrive in terms of productivity, sales, and market value.
When a company addresses modern slavery risks in shipping, such as long working hours and a lack of food, worker satisfaction, retention, loyalty, and productivity would increase throughout the supply chain.
Consumers will see the company assuming corporate social responsibility when businesses report efforts to end shipping modern slavery risks. As a result, customer loyalty and sales may improve.
Following the “S” indicators and addressing modern slavery risks in shipping supply chains can reassure investors that shipping modern slavery will not jeopardise a company’s reputation. This avoids lowering its market value.
With increasing expectations from stakeholders on supply chain sustainability, addressing modern slavery risk in the shipping supply chains would be a significant first step.
STEP-BY-STEP GUIDE TOWARD SUPPLY CHAIN SUSTAINABILITY
- Identify modern slavery risks in shipping
The first step toward supply chain sustainability is to map your organisation’s structure and conduct a risk assessment to determine how much work needs to be done. There are four significant issues to consider when evaluating:
- Are your suppliers and vendors upholding their Supplier Code of Conduct or modern slavery-related commitments?
- Do effective grievance and whistleblowing mechanisms exist?
- Is your organisation supplementing information provided by suppliers with on-site audits and meetings with their workforce
- Is your workforce aware of and trained to recognize the signs of modern slavery risk?
To comprehend these four issues, it is necessary to understand who and what managerial positions within an organisation can play an essential role in reducing modern slavery risks within supply chains.
You can conduct due diligence on managers, agents, officers, and, in the case of time or voyage charterers, the counterparty ship owners. You can also pose the following questions to them:
- Could you please explain your supply chain sustainability policy to me?
- Do you know any known modern slavery risks in the shipping supply chain?
A solid understanding of the above four areas will assist you in determining how vulnerable your company is to the modern slavery risks in shipping.
- Manage identified modern slavery risks in shipping
After identifying and assessing modern slavery risks in maritime supply chains, you may wonder how to address the identified risks. You may conduct additional due diligence on the entity’s operations and supply chains to review and adapt contract terms and supplier codes of conduct. Then, carrying out remedial steps where modern slavery is identified.
- Prevent modern slavery risk in shipping
Now that you know how decision-makers and employees in your company contribute to modern slavery risks prevention. You also have tackled the identified risks. To ensure supply chain sustainability, you can move on to prevent future modern slavery risks in shipping.
- Track suppliers to identify potential modern slavery risks in shipping.You can conduct self-assessments and site visits regularly for higher-risk third-party shipping suppliers and contractors to detect modern slavery risk and propose improvements to strengthen their governance systems. You can also see if the vessel has been barred from entering ports due to MLC violations.
- Through risk assessments and internal audits, implement processes and KPIs to track the effectiveness of steps to eliminate modern slavery risk in shipping to ensure supply chain sustainability.
- Educate employees about shipping modern slavery risks and their ramifications. As part of their induction training, you can provide modern slavery awareness training to all your employees and new hires. This can let them know and avoid modern slavery risks in the maritime supply chain.
- Stay current on the shipping industry trends. Our online search tools assist businesses in delving deeper into industry-specific topics by searching archived news articles, blogs, and websites from credible sources. This can let you comprehend the complexities of managing modern slavery risk in shipping.
- Hire a compliance officer responsible for the above steps if needed.
- Formulating modern slavery policies will entail gathering current policies, identifying gaps, adapting existing policies, and developing new procedures. You can conduct internal audits in compliance with the Modern Slavery Act. You can also ensure that all new supplier agreements include contractual clauses prohibiting slavery. We also recommend that you keep a channel open for reporting potential noncompliance. With Diginex, we created an innovative tool for workers’ voices called Apprise Audit. The Apprise Audit system will allow companies and front-line responders to interview workers anonymously and remotely in their native language to ensure your supply chain is slave-free.
CONCLUSION
Identifying and addressing modern slavery risks is a significant barrier to sustainable supply chains. However, with the above three steps of proper inspection, training, tools and policy, you can protect people suffering from slavery in the shipping supply chain.
To learn more, join us for our upcoming webinar on November 24th at 16:00 GMT+8. To register follow the link by clicking here.
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For more information on Apprise Audit, get in touch to learn how we can help you to collect essential information on working conditions in your shipping supply chain at [email protected].
Author: Tsz Yin Wong
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Reference:
https://www.tlblaw.com.au/modern-slavery-in-supply-chain/
https://www.nortonrosefulbright.com/en/knowledge/publications/b87356e9/modern-slavery-and-human-trafficking-reporting-the-risks-of-modern-slavery-in-maritime-supply-chains
https://www.swireshipping.com/information/info-pages/sustainability/modern-slavery/
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International Sporting Events: A Catalyst for World Betterment
I made the twenty-five hour drive from Moscow to Sochi in the summer of 2013, where I would spend the next year living with my family in a cramped, orange-colored apartment overlooking the Black Sea. Over the course of six months, I saw the city transformed: buildings erected, restaurants opened, souvenir shops filled to the brim with Olympic merchandise. A resort town on the “Russian Riviera,” Sochi was relatively unknown to those outside the country until it was nominated as the host city for the 2014 Winter Olympics.
A spectator at the Games, I never imagined the hidden crimes that plagued international sporting events. During major events like the Olympics, forced labor and human trafficking reports often spike.
The driving force? Demand.
In order to build stadiums and upgrade public infrastructure quickly, a large labour force is required. Unskilled workers, desperate for employment and an income, accept these jobs and are left at the mercy of employers seeking to gain maximum profit. In one reported case, eleven men were found victims of human trafficking, subjected to abhorrent living conditions and false promises in regard to their wages during construction of the 2016 Summer Olympic Games in Rio. The safety and protection of workers is also not prioritised, with one Napalese worker dying every two days during the construction of the 2022 World Cup in Qatar.
While a heightened demand for labour is the driving force behind one human exploiting another, transportation of victims disguised as visitors is the means by which it is done. Many illegal migrants are exploited and abused, often indebted to their traffickers, and at the mercy of those controlling their movement. Mega events create the perfect conditions for traffickers to move workers around with ease and without consequence, a fact supported by the high rates of illegal migration discovered during the 2010 World Cup.
So what can be done?
The answer, in short, is a collective effort by the International Olympic Committee, non-governmental organizations, and the host country itself to educate visitors on human trafficking and the role they can play in its prevention. It’s A Penalty, an organization dedicated to eradicating human trafficking by using international sporting events as a platform, has rescued over 16,800 victims through collaboration with law enforcement, hotels, and airlines. The latter is especially important given that 71% of labour trafficking victims were brought to the United States via plane during the 2018 Super Bowl.
Businesses can also do their part in the fight against human trafficking by demanding transparency from their suppliers, especially when it relates to construction. Legislation in the U.S., U.K., and other countries have shifted in this direction, requiring companies to certify that their products are free from forced labour at every level of the supply chain. This may involve the private sector ensuring that any workers employed in construction projects have employment contracts, access to grievance reporting, and their conditions regularly inspected via social auditing procedures. Often issues in the construction industry are hidden in plain sight because companies use third party labour brokers and fail to conduct comprehensive inspections on how the migrant labour was sourced. Transparency, not naming and shaming, is “one of the single largest deterrents in being able to prevent labour trafficking,” according to Annalisa Enrile, a professor at the University of Southern California.
Major sporting events, especially the Olympics, are founded on values of friendly competition, mutual respect, and the promotion of excellence. What people fail to realise is that these values are not confined solely to the realm of sport but can also be used as a catalyst for change in building a better world.
Author: Mackenzie Nace
Sources:
https://www.espn.com/espn/story/_/id/25876477/the-rise-exposure-human-trafficking-sports-world
https://www.interaction.org/blog/how-global-sporting-events-can-encourage-human-trafficking/
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A New Frontier for Us: ‘Metaversification’
By definition, the metaverse represents a “virtual-reality space in which users can interact with a computer-generated environment and other users”. While the metaverse has been around for many years in the form of computer games and simulation worlds, it has continued to grow at a slow, gradual pace. With Facebook’s recent public announcement in October 2021 to invest billions into metaverse technology, this all changed. Many tech companies and internet service providers are expanding their efforts in this new frontier.
What can we expect from this new metaverse reality? The most likely outcome will be computer-generated worlds that allow a person to put on a headset and enter three-dimensional virtual environments. Each of us will become avatars of our own selection – people, animals, comic figures, monsters, and the like. At first, we expect that these characters and environments will be simple and unsophisticated. But in time, these worlds will become more and more complicated and life-like as more people join. The metaverse will also bring together elements such as digital currency, marketplace/digital commerce, gaming, digital assets, entertainment and events, online shopping, workplaces, and social media.
One good example of an existing metaverse is Second Life. This virtual world, which has been around since 2003, allows people to create an identity, meet people, buy land and build their own environment or purchase an existing one. People who enter these worlds sometimes find it hard to escape. As one user stated, “I literally created the life I wish I had and now I’m addicted.” Over the weekend, I read an article that stated that by 2025, each of us will spend up to one hour a day in this new reality. Wow, this is an amazing prediction.
As the metaverse grows and expands, the non-government organisation (NGO) world needs to be involved in this process. This will ensure that this new reality doesn’t go off in a direction that ignores morals, ethics and human rights. In addition, the metaverse could offer a good place to allow NGOs to get their messages across to the people who will frequent these virtual worlds.
For this reason, the Mekong Club is already exploring a role we can play in the metaverse development process. This includes reaching out to Facebook, Google, and other major development players to offer our advice and guidance. With ESG being such an important, emerging priority for measuring what companies can and should do in relation to the planet, communities and workforces, we feel the same values should be included in the development of this new kind of reality. There are a number of different activities we would like to explore, including:
- Recommendations: The Mekong Club is seeking to acquire a seat at the table as this new phenomenon unfolds to help offer advice and guidance on how to include human rights values and other components related to addressing racism, discrimination, bullying, and sexism. Some of these elements have already been found in existing metaverse environments.
- Modern Slavery Prevention: Modern slavery recruitment has been found on a number of social networking platforms. For example, vulnerable groups are targeted by false promises of work or groomed into exploitative situations via online messaging platforms. In some situations, people are encouraged to send and share explicit material that is then used to blackmail and exploit them further. The Mekong Club will offer suggestions on how to avoid the metaverse allowing this to happen.
- Virtual Reality Film Tours: Virtual reality (VR) represents “a three-dimensional, simulated environment that is generated by computer technology” and it focuses on “an experiential interface rather than observational”. Research has informed us that the best way to learn is to experience a situation first-hand. The benefit of learning from VR is that it offers the viewer an opportunity to experience the emotional outcome of a sensitive issue. This allows the person to internalise on both an intellectual and emotional level. The Mekong Club has used VR tours in the past to sensitise people on sex trafficking and forced labour. We are in the process of acquiring more content related to this technology.
- Metaverse Workshops and Events: We will explore how we can use the metaverse to offer workshops and talks to raise much-needed awareness on the topic of modern slavery.
- Virtual Office: We are exploring the idea of having a metaverse office that would allow us to reach people in these worlds. The exact makeup and approach are presently under consideration.
The metaverse concept is exploding. The Mekong Club doesn’t know what this will mean for our charitable efforts, but we hope to go along for the ride, help influence the “metaversification process” and instil the “metaverse for good” concept. Where this path will take us is yet to be known.
If you are interested in this process, please let us know. We are always open to collaboration.
Author – Matthew Friedman