Modern Slavery Act 2015
Does the Modern Slavery Act apply to us?
The Act requires all commercial organisations carrying on business (or part of their business) in the UK with a turnover of £36 million or more, to prepare and publish an annual slavery and human trafficking statement. Please see here for what is meant by “carrying on business”, whether a business is being carried on in the UK and how the Act applies to groups and subsidiaries.
We are caught by the Modern Slavery Act, what do we need to do now?
The reporting obligation is now in effect and organisations have six months from the year end to publish a statement for each financial year ending on or after 31 March 2016 in which their turnover exceeds £36 million. The statement must either set out the steps that the business has taken to prevent modern slavery in its supply chains and own business or state that no steps have been taken. It must be approved by the board, signed by a director and published on the organisation’s website.
What actions should we be taking in respect of our supply chains?
Organisations should start by mapping out their supply chains so that they understand how and from whom they obtain goods and services. This will allow them to design a risk assessment to identify those parts of the supply chain where slavery is an inherent risk and to investigate and reduce those risks appropriately. Our briefings The Modern Slavery Act – does it apply and what to do if it does? and The Modern Slavery Act 2015 set out more detailed guidance on the steps organisations should be taking.
Why is it important to take these steps?
The Act does not impose any penalties or fines on organisations which take no steps to prevent modern slavery provided they have published a statement confirming this. Instead the Act depends on interested parties, such as NGOs, reviewing the action that organisations are taking and applying public pressure to those organisations who are identified as not doing enough to prevent slavery.
The Business & Human Rights Resource Centre is already collating an online database of published statements; its website states that the database “will allow users to see which companies have complied with their obligations and compare the action they are taking.”
Organisations who fail to take their ethical responsibilities to prevent modern slavery in their supply chains seriously risk significant reputational damage.
How Walker Morris can help
This is a new and developing area, and there is little detailed guidance available for organisations. We understand that every supply chain is different and that a “one size fits all” approach is not the answer. We will work with you to understand your supply chain and identify its inherent risks in order to develop a tailored set of policies, procedures and systems which are proportionate and cost-effective. We recognise that in order to be effective, these policies, procedures and systems must be embedded within your business’ culture and we will work with you to design a training and implementation programme to achieve this.
Where appropriate, we can introduce consultancy services specialising in carrying out risk assessments and onsite audits (both here in the UK and in other jurisdictions) tailored to ethical trading and human rights issues.
We provide different service levels according to your business’ individual requirements ranging from a full service package to a limited review of a draft statement to highlight any areas which are non-compliant or which may give rise to criticism from NGOs etc.