29 August 2023
- Engagement sees Compass Group, IHG report on modern slavery
- Call for Modern Slavery Act to mandate financial institutions to report on portfolios
- Find it, Fix it, Prevent it initiative now supported by 65 investor signatories representing £15 trillion in AUM
CCLA today publishes its Find it, Fix it, Prevent it Modern Slavery Report. The report highlights actions taken by CCLA and the global coalition of investors supporting its Find it, Fix it, Prevent it initiative to combat modern slavery through corporate engagement with investee companies, participation in shaping public policy and in developing better modern slavery data.
Investor engagement
In 2020, CCLA identified the hospitality and construction sectors for engagement. While engagement with the hospitality sector continues and is detailed in the report, it is evident that businesses have enhanced their due diligence processes, identified modern slavery cases and risks, and are starting to provide remedy to workers. The report also celebrates the progress made by both Compass Group and IHG who have reported on finding, fixing and preventing modern slavery in their global operations and supply chains. In late 2022, investors started to turn their focus to the construction sector.
Dr Martin Buttle, Better Work Lead at CCLA, said:
It is heartening to see that investors have been able to take a number of the businesses we have engaged with on a journey to address modern slavery. While it is a long journey and slower than we would like, we recognise that finding, fixing and preventing modern slavery is very involved but absolutely vital if we are to meet Sustainable Development Goal 8.7 calling for its eradication by 2030. As we move forward, we must more than redouble our efforts and replicate the progress achieved in the hospitality sector, in the construction sector and beyond.
Public policy
In March 2023, CCLA submitted written evidence to the Home Affairs Committee Inquiry into Human Trafficking and urged the UK government to focus on prevention by encouraging businesses to identify and address slavery and trafficking. CCLA also emphasised the need for the government to fulfil its promises to strengthen the supply chain provisions in section 54 of the Modern Slavery Act, while also mandating financial institutions to report on investing and lending portfolios.
Dame Sara Thornton, the former UK Independent Anti-Slavery Commissioner, now Consultant Modern Slavery with CCLA, provided evidence in person to the Home Affairs Committee at the House of Commons for the Committee’s first session of their enquiry into human trafficking. She explained that while the current legislation was world-leading when it was introduced eight years ago, it now needed to be strengthened.
Dame Sara Thornton, Consultant Modern Slavery for CCLA, said:
With 86% of the 27 million people in forced labour, employed by the private sector1, it is clear that businesses must take more action to identify and address slavery and trafficking in their operations and supply chains. Notably in the UK, we import an estimated $18 billion worth of goods that present a high slavery risk so we need our policy makers to step up legislation so that there is a level playing field and incentives for all companies to find, fix and prevent instances of modern slavery in their operations and global supply chains.
Walk Free Global Slavery Index
In June this year, Walk Free published their 2023 Global Slavery Index which links the compounding global crises to the 25% increase in modern slavery since 2016. With an estimated 50 million victims globally – double the population of Australia - the report highlights the role played by G20 nations in fuelling forced labour within global supply chains as these countries import US$468 billion of at-risk products annually. It highlights asset managers’ failure to consider modern slavery risks in their investments with only around a quarter indicating that they conducted some form of due diligence on modern slavery issues in their portfolios. Furthermore, only one in three asset managers in the UK disclosed being part of any relevant initiatives. The Global Slavery Index urges investors to conduct risk assessments, engage with investee companies and share good practice through being a part of industry initiatives such as Find it, Fix it, Prevent it.
Peter Hugh Smith, CCLA Chief Executive, said:
The Global Slavery Index makes for grim reading but it also makes it very clear. The investment industry can and should do more to address modern slavery. It is not right that investors profit from this crime and we need to do everything we can to engage with the companies we own so that they are active in addressing issues and providing remedy to those affected.
Furthermore, in an environment where we are progressing towards greater transparency and disclosure on what constitutes sustainable investments and where investment firms are increasingly required to substantiate product sustainability claims, we believe that the requirement to identify and address modern slavery in operations and supply chains should also extend to investment portfolios.
The Find it, Fix it, Prevent it initiative was created by CCLA in 2019 to bring together investors, academics and non-governmental organisations to share knowledge, set targets and monitor the progress of addressing modern slavery in businesses’ supply chains. Today the coalition is backed by 65 global investors representing £15 trillion in assets under management.
Press contact
Miranda Barham: miranda@mirandabarham.com or 07899 030 304
1 According to Global Slavery Estimates published in 2022 and compiled by The International Labour Organization, Walk Free and The International Organization for Migration, there were 27.6 million people in forced labour with 86% of those cases imposed by private actors.