Know thy supply chain — because modern slavery is distorting global markets

President Donald Trump's "Rocket Man" comment at the United Nations September 19 drew all the attention, but lost in the contrails of his speech was a critical matter related to the most basic of human rights — the issue of modern slavery.

Energy, mining, materials and commodities companies, in particular, best take heed — according to Andrew Forrest, the founder and chairman of Australian iron ore miner Fortescue Metals Group. Forrest has been on a mission to root out slavery from his own supply chain.

Forrest, along with Ivanka Trump, the president's daughter and senior White House advisor, participated in a UN special panel chaired by UK Prime Minister Theresa May and attended by other world leaders, including UN Secretary General Antonio Guterres.

More than 40 million people around the world were victims of modern slavery in 2016, new research, released September 19 during Forrest's UN visit, showed. The statistics come from Forrest's Walk Free Foundation, in partnership with the International Organization for Migration featuring research developed jointly with the International Labour Organization (ILO). According to the ILO, illicit profits from slavery amount annually to more than $150 billion.

Forrest has told the story that he reached out to 3,000 of his suppliers asking them to sign affidavits attesting they used no forced labor and were not practicing modern slavery. He reported that about 12 companies had problems signing.

"One organization in particular had really horrific slavery in their supply chains," Forrest told news.com.au. "They were making goods for myself and hundreds of companies which dot the Fortune 500 index, so all those companies had slavery in their supply chains as well at the time."

Transparency to hold businesses accountable

In March of 2015, the UK's Modern Slavery Act, a measure co-sponsored by the UK's May, became law. It compels major UK businesses to report transparently how they deal with slavery throughout their supply chains.

On the Modern Slavery Registry, a site maintained by The Business & Human Rights Resource Centre, the public can research company reports and statements to see which companies are doing what to eradicate modern slavery from their own operations and supply chains. As of September 27, there were 3,058 company statements from 26 industries and 34 countries.

Among the big companies in the energy space: BP, Chevron, Conoco, Crown Oil, Essar Oil, Koch Ag & Energy Solutions, Mercuria Energy Trading, Noble, Shell, Statoil and many more. Some of the mining, materials and ags signatories include BHP Billiton, Rio Tinto, Glencore, Freeport McMoRan, Anglo American, Johnson Matthey NA, VoestAlpine, Ferrexpo, Tata Steel Europe, and General Mills.

The BHRRC cautioned, however, that after a review of uploaded documents late last year "only around 14% of these statements comply with the legal requirements and most provide little information on the six areas that the Act suggests companies may wish to report on..."

In June of this year, the BHRRC, together with CORE, UNICEF UK and Anti-Slavery International released guidelines for the type of information that businesses should include in their statements.

Australia is close to passing a similar law as in the UK, and in fact, the UK's Modern Slavery Act of 2015 also had a model to build upon. According to the law firm Ropes & Gray, California was the first jurisdiction to move on modern slavery. In 2012 the California Transparency in Supply Chains Act became law, requiring companies to make disclosures about how they were dealing with slavery. "The US Federal Acquisition Regulation anti-human trafficking provisions, which among other things require US federal contractors to put in place specified compliance procedures, also were adopted in 2015," Ropes & Gray have reported.

What's more, according to the Republican-led US Congress, 13 bills have been passed in the House this year alone to combat modern slavery, sometimes referred to in slightly softer terms as human trafficking.

Ivanka Trump laid it out clearly in her remarks at the UN on the same day just a short while after his speech. She called modern slavery, "the greatest human rights issue of our time," and added that the US was "prepared to bring the full force and weight of our government" to fight it. She emphasized modern slavery "distorts global markets" and "we must take away the economic opportunity in these crimes."

That there are still 40 million people in modern slavery "shames us all,” Fortescue's Forrest said. "If we consider the results the last five years, for which we have collected data, 89 million people experienced some form of modern slavery for periods of time ranging from a few days to the whole five years. This speaks to the deep-seated discrimination and inequalities in our world today, coupled with a shocking tolerance of exploitation. This has to stop. We all have a role to play in changing this reality — business, government, civil society, every one of us."

For more information, visit the Walk Free Foundation or download the latest Global Estimates of Modern Slavery report.