The recently published Sancroft-Tussell Report reveals that a large number of suppliers to the UK government are failing to meet their UK Modern Slavery Act requirements, which could directly result in their disqualification from future government contracts.
The report explored how the UK government’s top contractors are meeting the challenge of identifying and addressing modern slavery in their operations and supply chain. It revealed that only 58 percent of the modern slavery statements produced by the top 100 suppliers to the UK government are legally compliant, meaning they contain a signature, board approval and a link on the company website. The other 42 percent of statements did not meet the requirements established in the UK Modern Slavery Act. Other key findings from the report include:
- Instances of weak or non-existent risk assessment practices, such as “calling upon suppliers to guarantee their supply chains were slave-free” and failing to note any modern slavery risks in public disclosure statements
- Companies are strongest when reporting on their organizational structure and policies
- Companies placed greater emphasis on future performance than current corporate social responsibility benchmarks
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Companies Could Be Disqualified From Future Government Contracts
Effective modern slavery reporting is an essential component of the robust corporate social responsibility programs the UK government expects their suppliers to uphold. The government has made modern slavery one of its top priorities, and is under rising pressure to lead by example by performing effective due diligence on its supply chain. In response, it has already signaled it will exclude companies from government contracts if they do not comply with the UK Modern Slavery Act. The report may prompt further action from the government as it works to address modern slavery in its procurement processes.
The Role of Public Procurement
Procurement agencies are under growing pressure to combat modern slavery in their supply chains due to the significant share of the global economy their spending represents, as well as the tremendous impact their purchasing practices have on workers rights worldwide. In response, they are adopting new approaches to protecting human rights, such as incorporating ethical criteria into the procurement process. The U.S. Federal Acquisition Regulation is one of the best examples of this. The UK may follow suit with Bill 2017-19, which seeks to amend the UK Modern Slavery Act to require public bodies to complete due diligence and reporting on their own supply chains.
Companies Need to Assess Modern Slavery Risks
Companies need to seriously address risks of modern slavery in their supply chains, especially if they supply to public bodies, to avoid a loss of contract, reputational risk and more. With a robust corporate social responsibility program in place, supplemented with comprehensive supply chain education and training, companies can ensure they are prepared to meet their requirements under the UK Modern Slavery Act and related regulations. The Corporate Social Responsibility Suite helps companies automate their supply chain data management, streamline communications, drive continuous improvement in their programs and more.
Contact info@assentcompliance.com for more information about your requirements under the UK Modern Slavery Act, or about how we can help with your corporate social responsibility program.