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Author: Brian M

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Modern Slavery in the Car Manufacturing Industry: Examining Forced Labour and Human Trafficking in Supply Chains

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Previously we have explored modern slavery and high risk supply chains such as fast fashion.  As we have learnt, it is prevalent across most industries worldwide, however, a recent probe has investigated forced labour within the car manufacturing industry.  Despite progress in recent years, forced labour, human trafficking and other forms of exploitation continue to be a significant on-going problem in the production of vehicles and their component parts.  A new report found “massive and expanding” links between major car companies and China’s Xinjiang region.

Xinjiang is a Chinese region where evidence has emerged of human-rights abuses committed by the Chinese Government against Uyghur Muslims, including forced labour, government surveillance, forced sterilisation and re-education camps.

The report by Sheffield Hallam University and Helena Kennedy Centre for International Justice, (which works on high profile projects in a variety of human rights) found “practically every major car part” had links to Xinjiang and that over 100 car and parts manufacturers were exposed directly or indirectly to goods made with forced labour.

8 major car manufacturers  including Ford, Tesla and General Motors are facing an inquiry from  Senate Finance Committee Chair Ron Wyden.  A key statement from the Senate Finance Committee states that “Unless due diligence confirms that components are not linked to forced labour, car manufacturers  cannot and should not sell cars in the United States that include components mined or produced in Xinjiang”.  Currently the United States considers the Chinese government’s brutal oppression of Uyghurs in Xinjiang an “ongoing genocide”.

A key statement from the Senate Finance Committee stats that “Unless due diligence confirms that components are not linked to forced labor, automakers cannot and should not sell cars in the United States that include components mined or produced in Xinjiang”.  Currently the United States considers the Chinese government’s brutal oppression of Uyghurs in Xinjiang an “ongoing genocide”.

The investigation comes following the Uyghur Forced Labour Prevention Act that bans products from Xinjiang unless organisations can prove their supply chains are free from forced labour.  The European Union also passed legislation prohibiting products made under forced labour.

Previously, Volkswagen have said that “no forced labour” was found at their Xinjiang plant.  However the recent report noted that one of the “most shocking new developments” in the past five years was that forced labour was now used throughout China and their factories which are part of the supply chain of major international organisations.

The report has a number of recommendations for buyers concerned about forced labour in Xinjiang. They include;

  1. To conduct thorough due diligence on suppliers and their suppliers, including regular inspections and audits to ensure compliance with ethical standards and labour laws.
  2. Implementation of a robust and transparent supply chain management system that includes regular communication and collaboration with suppliers.
  3. To establish a zero-tolerance policy for forced labour and human rights violations within supply chains, with clear consequences for non-compliance.
  4. Investment in technology and tools that can support, identify and prevent modern slavery, including data analytics, machine learning and blockchain.
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Exposing the Reality of Animal Cruelty in Supply Chains

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Animals play a key role in our supply chains, from farming such as cows, pigs and chickens for meat, to the breeding of animals for fur, wool and leather and testing on animals particularly for cosmetics.   The UK Government Department for Environment, Food & Rural Affairs provides key legislation, guidance and advice on protecting animal welfare on farms as well as whilst in transport, at markets and at slaughter.  Unfortunately, cruelty to animals is an all too common occurrence within supply chains.  Whether it’s through inhumane living conditions, neglect or outright abuse, the treatment of animals is often found to be unacceptable.

Campaigners have recently uncovered extensive cruelty at Kent’s Home Farm Dairy and are actively exposing the abhorrent reality of dairy farming within the UK.  Not many, if anyone, has heard of Kent’s Home Farm Dairy, however they supply their milk to Freshways who sell the milk to Costa Coffee.

Viva, who are the UK’s leading vegan campaigning charity have recently exposed the cruelty found at Kent’s Home Farm.  Footage shows workers slapping and kicking the cows at the Dairy, which has a herd of over 500 .  Their investigation also claims that the farm was “faeces-soaked” and that animals had their legs shackled to prevent them sliding in their poor conditions.

This isn’t the first time that a multi-international organisation have had their supply chains investigated.  Last year, Tesco were accused of using suppliers responsible for “environmental disasters” at key environmental sites.  Following Tesco’s decision to move suppliers to Avara led to a significant expansion of live stock being reared in the Wye Valley.  Avara had previously been under fire over their poultry welfare by Viva.

Last week, we published an article on food shortages due to climate change, but animal welfare in our supply chains is crucial.  Organisations can protect themselves by implementing animal welfare policies and guidelines with zero tolerance standards, and conduct regular audits and inspections of suppliers. They can work with third-party organisations to ensure compliance with industry standards, and educate employees and suppliers on the importance of animal welfare.  It is essential that suppliers can trace the origins of the product and ensure they are not involved in animal cruelty and mitigate against this to protect the animals but also their reputation. 

The Red Tractor Food Assurance is a UK based food safety and quality assurance scheme that covers the entirety of the food supply chain, from food to fork.  It ensures that food produce and products are made to a strict standard for food safety, environmental protection and animal welfare.  It is important as buyers to ensure that suppliers are part of the Red Tractor scheme because it provides assurance that the food purchased is of a high quality and has been produced in a responsible and sustainable manner.  Suppliers that are part of the scheme are regularly audited to ensure they meet high standards, providing additional peace of mind for buyers.

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3 ways we can mitigate against food shortages due to climate change

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Climate change is a global crisis that poses a threat to every aspect of our lives, including our food supply.  As the planet warms up, extreme weather events such as droughts, floods, storms and wild fires are becoming more frequent and more severe.  This is having a direct impact on food production, as crops are damaged or destroyed, and soil fertility is compromised.

In 2022, 12% of the population is struggling with malnutrition.  That means they’re not getting enough food to meet their basic needs.  This number is going to get worse because we’re seeing more and more extreme weather events and disasters.  Climate change will not only cause people to lose their lives, but those negatively impacted by climate change, will start to look for ways to better their lives and will therefore become more  vulnerable to modern slavery and human trafficking.  It’s a really dire situation further elaborated on in this report by the International Monetary Fund.

According to a NASA study, by as early as 2030, climate change will have affected  the global production of maize and wheat with estimates stating a decline by 24%.

Additionally, the demand for food is increasing as the global population grows.  We need to find ways to ensure that our food supplies are secure and that we can feed everyone on the planet.  One way to do this is through advocating for the environment and climate through procurement.

  1. Reducing food waste: By working to reduce food waste within our own operations and supply chains where possible, businesses and organisations can help to ensure that more food is available to meet demand.
  2. Donating excess food to local community fridges and food banks is a fantastic strategy as they bring people together to eat and connect as well as reduce food waste.
  3. Reducing our carbon footprint overall to mitigate climate change more broadly will have a positive impact on food shortages as well as other aspects of climate change such as extreme weather events that can lead to poverty, modern slavery and biodiversity loss.

Climate change is a major threat to food security, but by adopting procurement practices that support the reduction of food waste and positively impacts climate change, we can help to mitigate the impact of this crisis and ensure that everyone has access to safe, nutritious food whilst procuring for an environmentally friendly planet.

The UK Government spends £300 million a year through their procurement function and the procurement bill makes no references to climate or environmental factors.  This is why we’re asking our community to sign a UK Government & Parliament petition to amend the procurement bill to enshrine positive environmental obligations – https://petition.parliament.uk/petitions/621955

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Climate Change Displacement: How Rising Sea Levels and Extreme Weather Events Are Pushing the Poor Further into Poverty

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Poverty and displacement are two of the most devastating consequences of climate change.  As global temperatures continue to rise, natural disasters such as floods, droughts, and hurricanes are becoming more frequent and intense.  These events disproportionately impact the world’s poorest and most vulnerable populations, who often lack the resources to adapt and rebuild.

The United Nations estimates that over 143 million people could be displaced by climate change by 2050.   Many communities and individuals will be forced to evacuate their homes due to extreme weather events, sea level rising/floods and the loss of livelihoods.

For those living in poverty, the impact of displacement can be devastating.  Without access to the resources and support, people living in poverty will struggle to find adequate housing, suitable work, food, and medical care.  In some cases, they may be forced into informal settlements or refugee camps, where conditions are often overcrowded and unsanitary. Or worse, become vulnerable and subject to exploitation and be forced into modern slavery.

Furthermore, the loss of homes and communities can have long-term psychological effects, including trauma, depression, and anxiety.  It can also disrupt social networks and support systems, making it difficult for those displaced to rebuild their lives.

The impact of climate change on poverty and displacement is a major concern for both the global community and for individuals.  Governments and organisations have to take urgent action to address the root causes of climate change and to support those who are most affected.  This includes investing in adaptation and mitigation efforts, providing aid and support to displaced communities, and promoting sustainable development.

Displacement and poverty are the main drivers of modern slavery.  When individuals are forced to leave their homes and communities due to natural disasters, conflict, or economic hardship, they may become vulnerable to exploitation, and the traffickers offer them a better life and escape from the situation

For those who are displaced and living in poverty, the risk of falling victim to modern slavery can be particularly high.  Without access to resources and support, they may be forced to accept dangerous or exploitative working conditions in order to survive.

In some cases, individuals may be lured into slavery by false promises of good jobs or educational opportunities.  They may be tricked into debt bondage, where they are forced to pay the traffickers to get them a job and transport them to their new location, often by means of dangerous boat crossings. They have to work  to pay off debts that increase rapidly due to interest on their debts and are impossible to repay.  They may also be subjected to physical or sexual abuse or held against their will, with threats to their families lives if they do not comply.

The impact of modern slavery on individuals and communities can be devastating.  It can lead to physical and psychological harm and can disrupt social networks and support systems.  It can also perpetuate poverty and inequality, as victims are often unable to escape their situations and rebuild their lives.

To address the issue of modern slavery, it is important to address the root causes of displacement and poverty.  This includes supporting sustainable development and economic growth, reducing emissions that are impacting climate change, promoting peace and stability, and providing aid and support to those who are most vulnerable.

By working together, we can help to reduce the risk of modern slavery and support those who are most affected.

As procurement professionals, it’s important for us to not only focus on cost savings and efficiency, but also on the social and environmental impacts of our purchasing decisions.  Climate change and modern slavery are two major issues that we have the power to address through responsible procurement practices and effective due diligence

To address the issues  procurement professionals can implement responsible sourcing policies and practices.  This means carefully vetting our suppliers to ensure that they are not engaging in environmentally harmful practices, or are at risk of modern slavery in their business and supply chains It also means considering the environmental impacts of the products and services we purchase, and prioritising sustainable options.

Procurement professionals can also support initiatives that promote fair and ethical working conditions, and raising awareness about the issue of modern slavery.

By implementing responsible sourcing policies and practices, we can make a significant impact.  We can use procurement and our influence on purchasing decisions to drive positive change and support a more sustainable and humane world. Together, we can make a difference.

Steps to mitigate modern slavery

  1. Implement responsible sourcing policies and practices. This means carefully vetting suppliers to ensure that they are not engaging in modern slavery or other exploitative practices.
  2. Support initiatives that promote fair and ethical working conditions, such as fair trade organisations or labour rights groups.
  3. Monitor supply chains to identify potential risks of modern slavery, and take steps to address any issues that are identified.
  4. Work with other departments within the organisation, such as legal or HR, to develop a comprehensive approach to mitigating modern slavery through responsible recruitment practices.
  5. Raise awareness about the issue of modern slavery among colleagues, suppliers, and other stakeholders, and encourage them to take action to prevent it.
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The Role of Procurement in Combating Climate Change and Protecting Biodiversity

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Biodiversity is a technical term for all “life on earth” and its diversity (plants, animals, ecosystems etc).

Without a wide range of animals, plants and microorganisms, we cannot have the healthy ecosystems that we rely on to provide us with the air we breathe and the food we eat. It’s all interconnected and disappearing at an alarming rate!

Biodiversity loss is the decline in the variety of that life on earth. 1000’s of species and ecosystems are being destroyed by humans. We are over fishing for food, deforesting for logs and building materials, and over picking plants and vegetables for medicines.

We are experiencing a dangerous decline in nature and humans are causing it:

  • We are using the equivalent of 1.6 Earths to maintain our current way of life and ecosystems cannot keep up with our demands.
  • One million of the world’s estimated 8 million species of plants and animals are threatened with extinction.
  • 75% of the Earth’s land surface has been significantly altered by human actions, including 85 percent of wetland areas.
  • 66% of ocean area is impacted by human activities, including from fisheries and pollution.
  • Close to 90% of the world’s marine fish stocks are fully exploited, overexploited or depleted.
  • Our global food system is the primary driver of biodiversity loss with agriculture alone being the identified threat.
  • Agricultural expansion is said to account for 70% of the projected loss of terrestrial biodiversity

Biodiversity provides important ecosystem services, such as the pollination of crops, the purification of air and water, and the regulation of the climate, amongst many other things.  Therefore, the loss of biodiversity can have negative impacts on human health, food security/availability, and the overall well-being of societies.

The five main drivers of biodiversity loss today are:

  • habitat destruction
  • climate change
  • over-exploitation of species
  • pollution
  • and the introduction of invasive species (those that take over and destroy existing ecosystems)

These factors are causing a rapid decline in the variety of plants, animals, and other organisms on Earth, which is having serious consequences for ecosystems and the services they provide to humanity.  Habitat destruction, for example, occurs when natural habitats are converted for human use, such as for agriculture, urbanisation, or resource extraction.

Climate change, on the other hand, is the result of increased levels of greenhouse gases in the Earth’s atmosphere, which are causing the planet to warm.  These two issues are closely connected, as climate change can exacerbate biodiversity loss by altering habitats and making it more difficult for species to adapt.  The loss of biodiversity can also make it more difficult for ecosystems to cope with the effects of climate change.  It is therefore essential that we take action to address both of these issues in order to protect the future of our planet.

Over-exploitation of species, such as through over-fishing and hunting, can lead to their populations declining to the point of extinction.  Pollution can also have detrimental effects on biodiversity, by contaminating air, water, and soil, and affecting the health of plants and animals.

Finally, the introduction of invasive species, which are non-native species that spread and cause harm to native species and ecosystems, is also a major driver of biodiversity loss.

Therefore, biodiversity loss and climate change are two of the most pressing environmental challenges facing our planet today.  .

The impacts of biodiversity loss and climate change are far-reaching and profound..  For example, the loss of pollinators, such as bees and butterflies, can impact the ability of plants to reproduce and can lead to declines in the production of crops.

As COP15 draws to a close this week, we look at the 15th Conference of the Parties to the Convention on Biological Diversity which is a global treaty that aims to promote the conservation and sustainable use of biodiversity.  This year, COP15 discuss developing a framework to reduce pesticides and plastic, human / wildlife contact and soil.

The key targets of COP15 this year are;

  • Protecting Earth – More then 100 countries are currently supporting a proposal to conserve 30% of land and ocean by 2030. The UK, France, Canada and Costa Rica are backing this and is framed as the “biodiversity 1.5c target”.  However, this is facing a significant pushback from some Indigenous communities who claim this could justify land grabs as well as human right violations.
  • Pesticides – Across the world, insect populations are falling. Heavy use of pesticides that are designed to kill insect life but are essential to healthy ecosystems everywhere.  During COP15, countries are discussing how to reduce pesticide use by two-thirds.  The European Union has said it will aim to reduce pesticides by 50% by 2030.
  • Extinctions – 1 million species are facing extinction from human behaviour however some countries refuse to acknowledge this.
  • Government subsidies – Every year $1.8tn on subsidies driving the annihilation of wildlife and a rise in global heating. Governments are spending fortunes on environmentally harmful policies.  These funds can occasionally be spent for the good of preventing poverty, but many countries want to include a target to reduce or repurpose at least $500bn a year by 2025.
  • Plastic pollution – In March, a legally binding treaty on plastic waste was agreed to by world leaders.  Any targets agreed at COP15 will be centred around the ongoing treaty.
  • Invasive Species – Japanese knotweed as an example of an invasive species is a plant that has been spread by humans and have caused havoc. During COP15, leaders will draft a target that proposes greater efforts to eliminate invasive species and reduce the spread by half.
  • Nature Restoration – It is expected that world leaders will agree to expanding protected areas and restore at least 1bn hectares of degraded terrestrial, marine and coastal ecosystems.

How can Procurement help?

Procurement teams can mitigate and prevent biodiversity loss by procuring goods, works and services that are sustainably sourced and produced.  This means choosing suppliers that use environmentally friendly production methods and materials that aren’t harmful to the environment or biodiversity.

Procurement can take a lead on creating awareness and driving action through their contracts under supplier commitments. This can include protecting and restoring habitats, reducing greenhouse gas emissions, and supporting the development of renewable energy sources.  By working together, we can help to protect the planet and its inhabitants for future generations.

They can also work with suppliers to develop more sustainable products and services

Procurement must procure products that help reduce waste by purchasing products with minimal packaging and choosing suppliers that have a strong recycling and waste reduction policy.  This can help reduce the demand for resources and prevent habitation destruction.

The UK Government spends £300 million a year through their procurement function and the procurement bill makes no references to climate or environmental factors.  This is why we’re asking our community to sign a UK Government & Parliament petition to amend the procurement bill to enshrine positive environmental obligations – https://petition.parliament.uk/petitions/621955

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The links between climate change and modern slavery can no longer be ignored

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The United Nations recently issued an appeal for more than £700m for flood-hit Pakistan.  The funds will support families to battle malnutrition and infections in what has now been declared a public health emergency.  However, for those that can’t access financial support, they could be at risk of exploitation by traffickers and ultimately fall into modern slavery.  Climate change has already left millions at risk of losing their homes and livelihood whilst further environmental degradation pushes even more people to be displaced.  For those already at risk, climate change presents a horrific new threat to their freedom. 

A report by anti-slavery, From a Vicious to a Virtuous Circle looks at how climate change is having a destabilising effect on urban and rural communities.  Climate change is further exacerbated by economic activities that cause environmental degradation.  The effects further worsen through pre-existing socio-economic vulnerabilities, deepen exclusion and marginalisation, driven displacement, migration and the heighten risk of modern slavery for families.  The report further highlights the close links between climate change and exploitation and why strategic focus on climate change and the environment is necessary.

Overall, climate change impacts directly and indirectly, an array of internationally agreed guarantees on human rights and modern slavery.  Governments have an affirmative obligation to take effective measures to prevent & reduce climate impacts to mitigate human rights and modern slavery violations.  Fighting climate change requires that climate action is consistent with existing legislation and obligations.  

Those who have contributed the least to climate change are unjustly and disproportionately suffering its harm.  During COP27, small island nations requested  oil giants to pay for damage from climate change and rising sea levels.  Antigua Prime Minister called for a ‘global carbon tax’ on fossil fuel companies’ profits.  As the effects of climate change increases, and floods, droughts and severe weather events raise, communities impacted will need to find alternative places to live.

A report by IIED, “Climate change, migration and vulnerability to trafficking” details that 42% of households who had left their homes in Palamu, Jharkahand state due to drought have experienced forced labour, bonded labour, debt bondage, wage withholding or exploitative working conditions due to being desperate to find work and support their families.

Modern slavery and human right violations can ultimately be found in our supply chains, if as procurement professionals we don’t identify and survey our supply networks.

Procurement professionals and stakeholders can address social-ecological impacts by changing how we procure to focus on climate and environmental goods, works and services such as purchasing remanufactured items over new.  The UK Government spends £300 million a year through their procurement function and the procurement bill makes no references to climate or environmental factors.  This is why we’re asking our community to sign a UK Government & Parliament petition to amend the procurement bill to enshrine positive environmental obligations – https://petition.parliament.uk/petitions/621955

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8 Impacts of Climate Change

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When we think about the impacts of climate change, we initially think that this could mean we have longer and much warmer summers here in the UK, some may also think about the increased severity of storms, droughts etc.  However not many people realise the full effects. We perhaps don’t consider the increased risk of modern slavery, biodiversity loss, food and water supply, rising sea levels, coastal erosion and the impact of climate change against the cost of living and forced displacement.

Over the coming weeks we will be exploring each of the major impacts below in more depth through our series of climate change articles.

  1. Warming Temperatures

As greenhouse gas concentrations are rising the global surface temperature increases.  2011 – 2020 was the warmest decade on record and since the 1980s, each decade has been warmer than the previous one.  Globally, we’re experiencing warmer days and heat waves whilst higher temperatures have contributed to the increase in heat-related illnesses.  Due to warming temperatures and climates, wildfires are beginning to become common whilst the temperatures in the Artic are warming twice as fast vs the global average and causing oceans to rise.

  1. Severe Storm and Weather Events

Across the globe, frequent and destructive storms have intensified in many regions. As temperatures rise, moisture evaporates and intensifying  extreme rainfall leading to flooding and destructive storms.

  1. Increased drought

Whilst some parts of the world are experiencing severe storms and floods, other parts including the UK, are increasingly seeing droughts and hosepipe bans.  Climate change is exacerbating water shortages in already water-stressed regions.  On the other hand, deserts are expanding, reducing land for food growth and people are under threat of not having enough clean water on a regular basis.

  1. Warming and rising oceans

Over the past several decades, greenhouse gases have trapped energy from the sun, and as a result oceans are absorbing more heat and become warmer..  As oceans warm their volumes increase and water expands.  Melting ice sheets have caused sea levels to rise, threatening coastal and island communities. Whilst oceans absorbs carbon dioxide therefore keeping carbon dioxide from the atmosphere, carbon dioxide is ultimately causing oceans to become more acidic and endangering marine life and coral reefs.

  1. Loss of species

Climate change poses huge risks to both land and oceans, and due to increased temperatures the world is losing species at a rate of 1,000x greater than at any point in recorded history.  1 million species are at risk of becoming extinct within the next few decades through forest fires, extreme weather events and invasive pests and diseases all due to climate change.  A report by IUCN documents that the first reported mammal to go extinct as a direct result of climate change is the Bramble Cay Melomys (Melomys Rubicola) and whilst some species will be able to relocate and survive, others will not.

  1. Food crisis

Increased changes to climate change due to extreme weather events are a contributing reason behind global rise in hunger, poor nutrition and food costs increasing.  Fisheries, crops and livestock are being destroyed or becoming less productive.  Whilst oceans become more acidic, marine life that feeds billions of people are at risk, the Artic region have disrupted food suppliers.  Climate change is also a leading cause of heat stress that diminish water and grasslands for grazing livestock and therefore a decline in crop yields. 

  1. Increased health risks

Climate change is the single largest health threat facing humanity.  Climate change impacts are already harming the health of billions through air pollution, disease, extreme weather events, forced displacement, mental health concerns and increased hunger and poor nutrition for those living in poverty.  Year on year, environmental factors take the lives of 13 million people.

  1. Poverty and displacement

Through floods and extreme weather events, poverty and displacement has increased.  Floods have swept through and destroyed communities, demolishing homes and livelihoods.  Between 2010 – 2019, weather-related events have displaced an estimated 23.1 million people annually, leaving many more vulnerable to poverty and the risk of being entrapped into slavery.  Most refugees come from countries that are most vulnerable to the impacts of climate change.

The UK Government can be the lever for change if we want to address climate change with urgency.  If we change how the public sector procure their goods, works and services.  The Procurement Bill 2022 is an opportunity to do this if we amend the Bill to enshrine legally binding environmental and climate obligations.  To do this, we’re urging our candidates, customers, partners and the wider procurement community to sign the petition: https://petition.parliament.uk/petitions/621955

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A brief overview of Modern Slavery in the UK

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When we think of modern slavery, we don’t think of it being on our doorstep, within our own communities or within our supply chains.  However, it’s often much closer than you think and hidden in plain sight. With modern slavery figures continuing to rise, its highly likely you have unknowingly witnessed people who are trapped in modern slavery or purchased goods, works and services through supply chains where modern slavery is a commonplace.

What is Modern Slavery

People currently suffering in modern slavery are enslaved to do things against their will usually making clothes, serving food, picking crops, working in factories or in homes as cooks and cleaners.

Most common forms of Modern Slavery

Human trafficking – Use of violence and threats to transport, recruit or harbour people in order to exploit them for a multitude of reasons; prostitution, labour, criminal activity, marriage or organ removal.

Domestic servitude – Domestic work and servitude are not always classed as modern slavery, and when properly regulated can be an important source of income for many people.  However, when victims of domestic servitude are working in other people’s homes, they may be particularly vulnerable to abuses, exploitation and slavery as they could be hidden from sight and therefore lack legal protection.

Debt bondage/bonded labour – A common and widespread form of slavery.  Victims of modern slavery trapped in poverty borrow money and are forced to work to pay off the debt and therefore lose control over their employment conditions and the debt.

Descent-based slavery – Where victims of modern slavery are born into slavery.  Although this is an old form of slavery, people are treated as property and they’re passed down the maternal line.

Child slavery – This includes child trafficking, child soldiers, child marriage and child domestic slavery.

Forced and early marriage – When someone is married against their will and unable to leave, most child marriages can be considered slavery.

Forced labour – Victims of modern slavery are forced to do work against their will, usually under threat of violence

E-commerce giant Shein was valued at $100 billion in October 2022, making it worth as much as Zara and H&M.  Shein has risen from relative obscurity to dominate fashion, and is a key driving brand in the issue of waste, with it’s “fash-fashion” model, taking revenue from $2 billion in 2018 to $15,7 billion in 2021.  Its model of manufacturing garments, plus the west’s demand for them, means it’s churning out 10,000 new products a day!  This is facilitated by the constant, timed mark-downs perpetuate the idea that you need to buy now and can’t wear anything twice.  Fast fashion is steeped in human rights and modern slavery as workers are working up to 18 hours a day without appropriate breaks, poor working conditions and sometimes paid up to 3pence an hour(which is not fair pay), not to mention the climate and environmental implications of fast fashion.

As it’s not frequently discussed, knowing how to spot the signs and preventing modern slavery is critical in fighting this crime and bringing the criminals to justice  The majority of crimes happen within supply chains so procurement professionals are at the forefront of ensuring processes are in place to ensure fair and legal worker conditions for all, and that their suppliers are equally as educated on the matter. This ensures you are  buying from ethical suppliers that can help to prevent and eradicate modern slavery from our supply chains.

Each year the scale of modern slavery continues to rise. Current statistics by the International Labour Organisation states that there are 49.6 million living in modern slavery conditions, 12% of all those in forced labour are children.  In the UK annual Modern Slavery Review it states “The number of NRM (National Referral Mechanisms) referrals provides a good indication of the scale of known victims in the UK but is not a good estimate of overall prevalence.  In 2019, 10,627 potential victims were referred to the NRM”.  Of course, the actual number of people within modern slavery will be considerably higher.

The potential for criminals to target victims is becoming more widespread today due to vulnerable people fleeing war torn countries, increased poverty, the ongoing impact of Covid and the high number of fleeing disaster areas such as flooding and earthquakes..  According to the European Commission, 89.9 million are currently forcibly displaced worldwide.

  • 27.1 million refugees
  • 53.2 million internally displaced
  • 4.6 million asylum seekers
  • 4.4 million Venezuelan refugees and migrants

People who are in vulnerable situations are more likely to be victims of modern slavery.  This is because they are more willing to take risks to find a better life elsewhere or better work to provide for their family.  For example, taking a job they know little about in a different country or taking a loan from traffickers getting them into debt.  The traffickers then use this debt bondage to force the victims into back breaking labour which is often dangerous with long hours.

We have previously written about modern slavery in Leicester textile supply chains.  Since 2020, a large-scale operation in Leicester responded to reports of exploitation and underpayment within their textile factories.  A recent report by Low Pay Commission details how textiles manufacturing in Leicester has been a focal point for substantial enforcement activity.  A fear of job insecurity and low expectations are amongst the factors for Leicester textile workers’ unwillingness to report their underpayments and working conditions as most are just being grateful to be employed whilst others are worried their hours would be reduced and therefore lose valuable income.

The BBC released a huge cache of data hacked from official servers in Xinjiang region of China.  The Uyghur people are being transferred to ‘re-education’ camps, systemically driving a state of ideology whilst orchestrating forced labour.  The first signs of Uyghur being detailed in these camps were in 2016.  The Chinese authorities released a statement stating that the camps were “vocational training centres” and were vital to tackle religious extremism, however there has been no credible evidence that these centres have had any impact on extremism or terrorism.  We explored further into what this looks like in China in this article.

How as procurement professionals can we do our bit to ensure modern slavery is tackled?  Since the “Tackling Modern Slavery in Government Supply Chains” guide for commercial and procurement professionals was realised in September 2019 we have seen both buyers and suppliers look to embed best practice into procurement to ensure we understand who we are doing business with, understand and identify any risks within supply chains and take appropriate action to address those risks with a particular emphasis on supporting the victims of modern slavery.

Additional support can also be found by using the Modern Slavery Assessment Tool which is a risk identification and management tool. This tool has been designed to help public sector organisations work in partnership with suppliers to improve protections and reduce the risk of exploitation of workers in their supply chains. It also aims to help public sector organisations understand where there may be risks of modern slavery in the supply chains of goods and services they have procured.

Stop the Traffik Global and Shiva Foundation published a very practical guide for SME’s to help raise awareness of modern slavery and support proactive management and identify modern slavery and related issues.  Download the PDF for free from our library.

To provide more context, here is an example of recent coverage of the Shein labour exploitation but there are many others. 

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Is your supply chain misleading you on their environmental claims?

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Increasing numbers of organisations are being “outed” for their greenwashing claims.  Greenwashing is the process in which a company or organisation will convey a false impression or provides misleading information about how environmentally friendly their service or product is. 

For example, companies and organisations involved in greenwashing might suggest that their products are made from recycled materials or have energy-saving benefits, and although there may be some environmental benefits, companies engaged in greenwashing typically exaggerate their claims or benefits.

44% of Centrica’s Carbon Offsets considered ‘junk credits’

A new report by Open Democracy, accuses British Gas of misleading their customers by selling ‘green energy’ that may have no environmental benefits.  This relates directly to British Gas claims that it has reduced its climate footprint by using “carbon credits”.  However, almost half the carbon offsets held by British Gas owner Centrica are considered junk credits that were issued under a discredited scheme.  An international probe found that Shandong Dongyue Chemical Co Ltd were “gaming the system”.

44% of Centrica’s carbon offsets came from Shandong Dongyue Chemical Co Ltd, which produces a type of greenhouse gas used in fridges and air conditioning.  Centrica operates under the trading names of Scottish Gas in Scotland and British Gas in England, Wales and Northern Ireland.

BBC News Arabic produced a documentary ‘Under Poisoned Skies’ which investigated flaring near the city of Basra.  Flaring is the process of burning off gas as part of the oil production process.  This produces clouds of acrid smoke and releases methane and dangerous chemicals like benzene.   In consequence, exposure to these chemicals contributes to high rates of leukaemia and other cancers among those living in nearby villages and towns.  BP, and other international oil companies working within this region, are earning millions while being fully aware of the situation. Loopholes in Emissions Reporting Rules mean BP and other oil companies can hide this from their shareholders and the wider public.  Greenpeace Unearthed have produced an extensive report into oil fields within this region and how BP and other oil companies report on their carbon footprint.

“We cannot afford greenwashing”

The United Nations Secretary-General, Antonio Guterres said net-zero commitment must be ambitious and credible.  Clean energy, such as wind-power, is a key element in reaching net-zero emissions.

H&M, the fast-fashion giant, showed customers misleading, and in many cases, outright deceptive environmental scorecards for their clothing, a new report by Quartz reveals.  More than half the scorecards claimed that items of clothing were better for the environment when, in fact, they were no more sustainable than comparable garments made by the company and their competitors.  The findings add to mounting scepticism and new regulatory scrutiny of the fast-fashion industry’s attempt to self police its environmental record.  Only a few weeks ago, we wrote about how human rights and modern slavery violations in Leicester were impacting the fast-fashion industry.

In a recent survey by Chartered Institute of Procurement & Supply, 19% of the 300 procurement professionals surveyed did not know how sustainable their products were, whilst almost 50% did not believe their organisation was being sufficiently transparent with consumers, clients and regulators about sustainability.

Procurement professionals today play a vital role in helping their organisation to achieve their sustainable objectives, supporting them to deliver net zero emissions, reduce and reclaim waste materials, create diverse supply chains, and encourage their suppliers to do the same, as well as deliver social impact in their communities and achieve compliance.  Evaluation of suppliers must consider the overall value that can be delivered throughout a contract in addition to commercial benefits and this value must be locked into contractual obligations and delivery managed through the whole contract lifecycle.

The Procurement Bill doesn’t factor legal environmental considerations which is why we’re currently supporting a petition to amend the Procurement Bill to enshrine positive environmental obligations that create a legal obligation on Contracting Authorities to ensure all specifications and contractors have a net positive impact upon the environment. Sign the petition here.

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Mitigating Extreme Weather Disruption within your Supply Chain

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A study of 12,000 suppliers in the US, China and Taiwan that served 100 Original Equipment Manufacturers (OEM) of technology, automotive and consumer goods found that 49% of suppliers experienced an increase in climate variability, with the proportion much higher in China and Taiwan (93%) than in the US. The most at-risk suppliers are those whose disruption would have major impact on the OEM’s revenue.

Recently, there has been extreme weather events across the world.  In August 2022, extreme flooding in Pakistan saw the tragic loss of 1,500 people and negatively affected more than 33 million more.  The floods were caused by monsoon rains that have been linked to melting glaciers that followed severe heat waves, all of which have been directly attributed to human-caused climate change.  Despite Pakistan contributing less than 1% of global greenhouse gas emissions. 

“What we saw in Pakistan is exactly what climate projections have been predicting for years.” Dr Friederike Otto

The floods have also impacted how the United Nations food aid is transported to Afghanistan, previously much needed food aid was delivered to Afghanistan via Pakistan.

What can you do to mitigate climate-related risks from your supply chain?

Organisations need to understand the impact of losing suppliers through climate and other risks associated with business to ensure climate continuity plans are in place should a supplier be unable to deliver their goods or services.

One way of mitigating climate related risks is to map out your suppliers that directly or indirectly support your organisation.  Understand and collect all the critical data including; costs, risks, delivery times and carbon footprint of each supplier.  This data can be used to get ahead of any supply chain disruptions ahead of time.   

Examine the vulnerability of each supplier and how their local region could be affected by extreme weather patterns and local geopolitical risk factors.

Integrate technology that ensures you can process the data you’ve collected on your suppliers to proactively monitor and prepare for extreme weather events.

By utilising a supply chain whose response to climate risk will ensure not only business continuity but will provide a competitive edge and advantage.  Procter & Gamble (P&G) were affected by Hurricane Katina however their purpose-built facility was built with climate risk in mind.  P&G were among the first manufacturers to restore operations following Hurricane Katrina due to their facility being designed to withstand 130 – 140mph winds and therefore held their 40% share of coffee sales within the US consumer market.

There are huge benefits to ensuring your supply chain has elements of climate continuity plans in place, disruption due to severe weather is the biggest climate change issue facing organisations currently.  However climate change and it’s affects will vary from country to country and from location to location within that country.  The level of risks faced by organisations will also vary.

Extreme weather events will continue to impact supply chains across the world unless more is done to minimise climate change.  The Procurement Bill 2022 can be the lever for change if we can ensure that it’s amended to legally enshrine environmental obligations onto the Public Sector to make environmentally friendly procurement decisions.  As it stands, there are no environmental obligations, we’re actively encouraging procurement professionals, stakeholders and the wider community to sign the petition.  This will ensure that taxpayers’ money is spent in an environmental and climate friendly manner.