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Understanding the Modern Slavery Act and your Supply Chain

20 June 2017

With the Modern Slavery Act of 2015 (MSA), the UK led the way in the fight towards eradicating modern slavery around the globe. The fashion and apparel industry has been among the worst offenders, and it is now under pressure to remedy this. But how can fashion suppliers build more transparency into their supply chain so customers feel reassured?

What is the Modern Slavery Act?

With 21 million people in forced labour and 170 million children engaged in child labour, it’s commendable that businesses, consumers, NGOs and governments are taking steps to tackle the problem. The Modern Slavery Act, which included a ‘transparency in supply chains provision’, requires all companies with a turnover of £36 million or more who supply goods and services in the UK, to publish an annual statement, signed off by the Board, to report on what steps (if any) they have taken to eradicate slavery in their supply chains and operations.

Why is forced labour a problem in fashion?

The fashion supply chain is very complex, with many aspects of the process contracted out to different suppliers. It can be hard for businesses to control and track every stage of production. This lack of transparency makes exploitation, unregulated practices and illegal activities easy to miss. Child labour is also more prevalent in fashion and apparel sectors due to the reliance on low-skilled workers for cotton picking and yarn spinning through to cut-make-trim processes. The high volume production demands and low cost, throwaway nature of fast fashion has also been a major contributor to exploitation.

Is the MSA working?

When it comes to implementing the MSA, there is no template for producing a statement. This leaves many companies unsure about what actions they need to take and what they need to cover off in the statement. Since the Act was passed, published statements indicate that many companies are not going far enough in their policies and paying lip service to the Act, simply undertaking rudimentary staff awareness training and basic factory audits.

What implications does the MSA have for my business?

To truly eliminate slavery in the supply chain, companies need to do more. It’s not as simple as adding a question to your CSR due diligence questionnaire or adding a clause to your existing CSR policy. How do you validate supplier statements and responses? Are your current supplier audits enough? While your first-line suppliers may be compliant, how do they check that their own suppliers are complying to those regulations?

CSR Action Plan

To answer those questions, you will need to make risk assessments of your supply chain, devise performance indicators and conduct independent supplier audits. This means working closely with your suppliers to identify and manage risks, ensure suppliers establish grievance mechanisms for factory workers and have stronger engagement with stakeholder groups such as NGOs.

The first thing to do is ensure your corporate supplier manufacturing policy is stringent and adhered to. At JSD, we work with not-for-profit organisations like the Ethical Fashion Forum (EFF) to help provide a greater level of assurance to ourselves, and our customers. As the international industry body for sustainable fashion with over 10,000 members, the EFF gives you access to the latest industry standards and best practice.

Ethical sourcing and networking

Many companies find sourcing ethical suppliers and performing due diligence on them a real challenge. The EFF have developed Common Objective (CO) – a global platform of tools and services for sustainable fashion. It includes a database of ethical suppliers, specialist business intelligence and online network connecting thousands of sustainable fashion professionals and businesses across the supply chain. At JSD, we are also members of Sedex, the world’s largest collaborative platform for sharing responsible sourcing data on supply chains. If your suppliers are members of these NGOs, it shows they are committed to ethical values.

Risk assessment

BSI’s Trafficking & Supply Chain Slavery Patterns Index is a risk assessment tool that helps companies identify which countries are most at risk of being a source country for trafficking and forced labour. While it may not be a surprise to hear that India and Bangladesh are labelled ‘severe’ risk, it may be a shock to realise that a European country like Italy is considered ‘high’ risk.

Monitoring and KPIs

Other NGOs like the Fair Wear Foundation (FWF) run accreditation schemes, working with brands, factories, trade unions and governments to make the supply chain more transparent by verifying, improving and monitoring workplace conditions in 11 production countries globally.

By signing up to accreditation schemes, companies are rooting their CSR policies deeper into the supply chain and are also ensuring that their suppliers are equally committed to ethical values, making every company in the supply chain more accountable.

Once signed up, accredited brands must conduct regular audits to ensure all their suppliers meet these standards during production. At JSD, we conduct regular audits of all our corporate clothing factories to make sure our strict codes of labour practices are being adhered to.

Consumer demand

Consumers also play a role as their purchasing habits demand more transparency. A new Edelman Earned Brand 2017 study shows that half of consumers worldwide say they buy based on belief. 57% of consumers will buy or boycott a brand based on a brand’s position on a social or political issue, and 65% of belief-driven buyers won’t buy a brand if it stays silent on an issue they feel it has an obligation to address. So while there are no financial penalties for companies who choose not to investigate their supply chain, the Act does require companies to publish their statement or non-statement in a prominent position on their website. Given this survey’s findings, retailers should think carefully before they choose to take a ‘do nothing’ stance.

Innovation and disruption

Safia Minney, campaigner, founder of fair trade fashion label People Tree, is the author of a new book called ‘Slave to Fashion’, which highlights the stories of people caught up in slavery, and also shares positive success stories of best practice initiatives and offers a toolkit for action. She is passionate about eradicating slavery and is proactively working with progressive businesses to reinvent supply chains that are sustainable and ethical.

She says, “There are innovative and inspirational designers and brands who are disrupting the fashion industry and developing new supply chains and operations to put human rights at the same importance as profit.”

Uniforms you can be proud to wear

People, Planet, Profit: has long been our bottom line on Corporate Social Responsibility at JSD. The stability we can provide for our factories, with the large scale production our clients require, means that we really can make a difference to the lives of those who work in our supply chain. For example, our manufacturer in Sri Lanka supports an orphanage, infant school, medical clinic and sponsored sport within its village. This upholds not only our own brand values but also those of our clients – and really does enhance the lives of people who make uniforms you can be proud to wear.


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