August 9, 2024
For suppliers and contractors, demonstrating ethical practices against modern slavery is not just a moral obligation but a critical business imperative.
Modern slavery encompasses various forms of exploitation, including forced labour, human trafficking, debt bondage, and child labour. It strips individuals of their freedom, dignity, and basic human rights, subjecting them to inhumane conditions and often physical and psychological abuse.
According to The Global Slavery Index 2023, it is estimated that around 122,000 people are in situations of modern slavery. This insidious practice not only violates fundamental human rights but also poses a significant threat to businesses’ reputations and ethical standing.
Here’s why taking a stand against modern slavery is essential for suppliers and contractors:
Protecting Professional Reputation
It goes without saying that any businesses associated with modern slavery will seriously damage their professional reputation. In an age of increased transparency and social consciousness, a company’s reputation is one of its most valuable assets.
Suppliers and contractors who evidence their policies against modern slavery in their operations and supply chains will build trust with clients and partners. Forging a positive reputation can lead to long-term business relationships and foster brand loyalty.
Retaining and Attracting Clients
Needless to say, if any existing clients discovered that their suppliers and contractors were associated with modern slavery practices—the relationship would be ended quickly and swiftly. Clients are increasingly scrutinising the ethical practices of those they work with, and so suppliers and contractors need to prove their compliance in line with the Modern Slavery Act.
By proving their commitment to combating modern slavery, suppliers and contractors position themselves as responsible partners. This commitment can be a key differentiator in winning new contracts and retaining existing clients who prioritise ethical sourcing.
Regulatory Compliance
Many countries have implemented stringent regulations to combat modern slavery, such as the UK Modern Slavery Act. Suppliers and contractors who proactively address these issues ensure compliance with current and future regulations, avoiding potential legal risks and penalties.
The consequences for failing to adhere to such legislation could result in severe consequences for non-compliant suppliers and contractors.
The prison penalty for breaching The Modern Slavery Act ranges from 14 years to life imprisonment. Despite these severe consequences, many large brands have still breached the act, including Dior (part of LVMH). Recently, Dior’s UK website displayed invalid sustainability certifications which breached The Modern Slavery Act. Investors are now demanding that LVMH strictly control and check its suppliers’ treatment of workers.
