How To Prevent Forced Labor in Your Supply Chain – Regulations, Trends & Tools
Preventing Forced Labor in Global Supply Chains
Embrace third-party audits to ensure standards are met and exceeded
The movement to eliminate forced labor throughout supply chains has made significant progress to date but remains a considerable challenge for brands in most markets. Our latest survey revealed that 6% of ethical audits conducted had child labor violations.
While consumer advocacy is still growing, new directives are enforcing stricter regulations. And the stakes are high. Brands found to be complicit in forced labor can face boycotts, legal action, and a tarnished image that can take years to repair.
This article covers recent updates, current challenges brands face, and tools you can utilize to help you prevent forced labor in your supply chain.
Continued Ethical Challenges: Forced Labor and Worker Safety
Despite advancement in some areas, serious issues, including child labor and worker safety remain pervasive. The QIMA 2024 H1 survey results also show critical non-compliance related to child and young labor were found in 6% of ethical audits, globally. This is a disturbing trend, underscoring that even with regulatory efforts, child labor continues to be a significant problem in the global supply chain.
Worker safety also requires urgent attention. Fifteen percent of those ethical audits identified critical health and safety violations. Additionally, structural audits determined more than three-quarters of factories required remediation for issues related to structural integrity, fire safety, or electrical safety.
How do we take these findings and work, as an industry, to ensure companies are not only compliant with regulations, but also provide safe working environments that exceed worker expectations, beyond minimal requirements?
ESG Regulations Requiring Ethical Compliance
The adoption of the EU Corporate Sustainability Due Diligence Directive (CSDDD) in May has marked a significant step forward in strengthening ethical compliance across global supply chains. This directive mandates companies identify, prevent, mitigate and account for how they address actual and potential adverse impacts on human rights and the environment.
Specific due diligence legislation focusing on child and forced labor is emerging globally. These pieces of legislation come in the form of import bans, due diligence legislation, reporting requirements and investigations.
It is imperative that businesses reassess their due diligence processes and implementation tools. Due diligence must go beyond generic checks towards a long-terms continuous process of activating all tools in the toolkit, from traceability to onsite audits and worker voice tools. Supplier and local stakeholder engagement needs to be ramped up at the same time.
Reducing Risk of Ethical Violations in You Supply Chain
Third-party audits play a pivotal role in this effort. An objective, non-biased assessment of factory conditions and compliance offers brands a clear view of their supply chain's ethical landscape. These audits follow internationally recognized standards and can help identify problem areas and provide actionable insights for remediation. By working with trusted third-party partners, brands can ensure their supply chains adhere to ethical standards and regulatory requirements.
Implement robust due diligence processes and engage trusted third-party auditors to regularly assess and monitor supply chains.
Know Your Suppliers: Establish thorough vetting processes to ensure suppliers meet ethical standards.
Regular Audits: Conduct frequent third-party audits to identify and address compliance issues.
Beyond Audits: Facilitate access to remedy for workers and communities, provide capacity building to support continuous improvement
Transparency and Accountability: Maintain open communication with stakeholders about your efforts and progress in ethical compliance.
By taking these steps, companies can protect their brands, ensure the safety and well-being of workers and contribute to a more ethical and sustainable global supply chain.
Read the key takeaways from our 2024 Global Supply Chain Landscape and Trends report to help gauge the extent of forced labor and gain additional supply chain insights including sourcing disruptions, supply chain challenges, and other key trends.
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