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| Supply chains and forced labour after Rana Plaza: lessons learned | Supply chains and forced labour after Rana Plaza: lessons learned |
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| What does the Rana Plaza tragedy in Bangladesh in which more than 1,000 workers perished mean for those of us who are working to end modern-day slavery? For those of us focused on forced labour in supply chains, the lessons have been timely and crucial. | What does the Rana Plaza tragedy in Bangladesh in which more than 1,000 workers perished mean for those of us who are working to end modern-day slavery? For those of us focused on forced labour in supply chains, the lessons have been timely and crucial. |
| First, it reminds us that too many businesses do not know where their finished products are being made, even if we are talking about top-tier factories. In the immediate aftermath of the Rana Plaza collapse, several businesses expressed confusion about whether their products were being produced in one of the many workshops in that building. | First, it reminds us that too many businesses do not know where their finished products are being made, even if we are talking about top-tier factories. In the immediate aftermath of the Rana Plaza collapse, several businesses expressed confusion about whether their products were being produced in one of the many workshops in that building. |
| Second, we see that companies seeking supply-chain transparency face many challenges not of their own making. The tragedy in Rana Plaza demonstrates the awful outcomes that under poor and corrupt conditions. Poverty drives workers into situations where they can't say "no" for fear of losing their jobs. Their desperation is exploited by businessmen who lack a sense of social responsibility. The corrupt and under-staffed government refuses to exercise its responsibility. Make no mistake, these jobs can be better for workers than the alternatives available to them. But the result in the case of Bangladesh is terrible loss of life; elsewhere, the same conditions result in the exploitation of workers harvesting palm oil, growing cotton, and making bricks, as well as assembling garments. | Second, we see that companies seeking supply-chain transparency face many challenges not of their own making. The tragedy in Rana Plaza demonstrates the awful outcomes that under poor and corrupt conditions. Poverty drives workers into situations where they can't say "no" for fear of losing their jobs. Their desperation is exploited by businessmen who lack a sense of social responsibility. The corrupt and under-staffed government refuses to exercise its responsibility. Make no mistake, these jobs can be better for workers than the alternatives available to them. But the result in the case of Bangladesh is terrible loss of life; elsewhere, the same conditions result in the exploitation of workers harvesting palm oil, growing cotton, and making bricks, as well as assembling garments. |
| Third, we are reminded that the audit-focused social responsibility model that most companies have adopted is inadequate even for addressing the highly visible and relatively cut-and-dried issues of health and safety, much less the complex and hidden causes of modern-day slavery. In Bangladesh, auditors have routinely missed key issues that they should have found. | Third, we are reminded that the audit-focused social responsibility model that most companies have adopted is inadequate even for addressing the highly visible and relatively cut-and-dried issues of health and safety, much less the complex and hidden causes of modern-day slavery. In Bangladesh, auditors have routinely missed key issues that they should have found. |
| The same characteristics help cause modern-day slavery. The business processes that result in a finished product are multi-layered and complex, more like a web than a chain. The workers who help get products to market are legion, from those on the commodity level – in mineral and metal mines, in the agricultural fields – up through processing, manufacturing, warehousing, and transport. Slavery and trafficking are most prevalent at the commodity level – and when migrant workers are recruited by outsourced labour brokers. | The same characteristics help cause modern-day slavery. The business processes that result in a finished product are multi-layered and complex, more like a web than a chain. The workers who help get products to market are legion, from those on the commodity level – in mineral and metal mines, in the agricultural fields – up through processing, manufacturing, warehousing, and transport. Slavery and trafficking are most prevalent at the commodity level – and when migrant workers are recruited by outsourced labour brokers. |
| How should we expect companies to learn from Rana Plaza and extend those lessons to address the serious but hidden issues of modern-day slavery? | How should we expect companies to learn from Rana Plaza and extend those lessons to address the serious but hidden issues of modern-day slavery? |
| • Companies should map their supply chains against known hotspots for forced labour and trafficking. These are often geographic (for example, forced labour is common in Thailand); they can be linked to specific commodities (see Verité's forced labour commodity atlas); and they result from the presence of labour migrants. | • Companies should map their supply chains against known hotspots for forced labour and trafficking. These are often geographic (for example, forced labour is common in Thailand); they can be linked to specific commodities (see Verité's forced labour commodity atlas); and they result from the presence of labour migrants. |
| • When a hotspot is identified, companies are accountable for assessing the capability of partner businesses to understand and address the risks that they face. Does that supplier demonstrate knowledge about the risks? Do they have capabilities to address those problems? Do they have plans in place? How are they holding their own suppliers and subcontractors accountable? Companies should go directly to their suppliers' workers to interview them about their experiences. Doing so is a very effective way to get full answers to these questions. Auditing will always be inadequate and can never make up for the choice of a bad business partner. | • When a hotspot is identified, companies are accountable for assessing the capability of partner businesses to understand and address the risks that they face. Does that supplier demonstrate knowledge about the risks? Do they have capabilities to address those problems? Do they have plans in place? How are they holding their own suppliers and subcontractors accountable? Companies should go directly to their suppliers' workers to interview them about their experiences. Doing so is a very effective way to get full answers to these questions. Auditing will always be inadequate and can never make up for the choice of a bad business partner. |
| • Companies need to provide remedies. Apple has demonstrated this effectively, coming to grips with the vulnerability of migrants in its Asian assembly, by demanding their suppliers reimburse a total of $13.1m (£8.7m) to contract workers who paid unscrupulous labour brokers to get a job, including $6.4m in 2012. This is a measure that matters to workers. Companies are required under the UN guiding principles to remedy human rights abuses to which they contribute. | • Companies need to provide remedies. Apple has demonstrated this effectively, coming to grips with the vulnerability of migrants in its Asian assembly, by demanding their suppliers reimburse a total of $13.1m (£8.7m) to contract workers who paid unscrupulous labour brokers to get a job, including $6.4m in 2012. This is a measure that matters to workers. Companies are required under the UN guiding principles to remedy human rights abuses to which they contribute. |
| When reviewing corporate disclosures about supply chain labour rights, we often put a company to an initial test: does it admit that it has problems? When we reviewed 600 publicly listed companies in the US, we found that only 7% disclosed that they had labour rights problems in their supply chains. That leaves 93% in either publicly – or privately – held denial about the realities of sourcing and supplying from around the world. | When reviewing corporate disclosures about supply chain labour rights, we often put a company to an initial test: does it admit that it has problems? When we reviewed 600 publicly listed companies in the US, we found that only 7% disclosed that they had labour rights problems in their supply chains. That leaves 93% in either publicly – or privately – held denial about the realities of sourcing and supplying from around the world. |
| After Rana Plaza, the focus is rightfully on the first step of getting a grip on the factory system in Bangladesh and preventing another tragedy – such as fires and building collapses. But let us not ignore the continuing and largely hidden tragedy faced by millions of workers who are forced to work in appalling conditions: because they owe money to their recruiter; because their passports have been confiscated by their employers; or because their visa ties them to their job. | After Rana Plaza, the focus is rightfully on the first step of getting a grip on the factory system in Bangladesh and preventing another tragedy – such as fires and building collapses. But let us not ignore the continuing and largely hidden tragedy faced by millions of workers who are forced to work in appalling conditions: because they owe money to their recruiter; because their passports have been confiscated by their employers; or because their visa ties them to their job. |
| Companies must be accountable for these continuing problems, just as they commit to new levels of action to improve life safety for workers. | Companies must be accountable for these continuing problems, just as they commit to new levels of action to improve life safety for workers. |
| Dan Viederman is chief executive officer of Verité, which campaigns for fair labour worldwide | Dan Viederman is chief executive officer of Verité, which campaigns for fair labour worldwide |
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