U.K. Independent Anti-Slavery Commissioner Kevin Hyland has issued an ultimatum to the government to get moving on setting up a central, state-owned registry for corporate modern slavery statements that he wants in place before he leaves office later this summer.
Section 54 of the Modern Slavery Act requires companies to publish a statement on modern slavery that meets the following requirements:
Statements should be approved by the board of directors—this ensures boards are seriously discussing the issues.
Statements should be signed by a director—this ensures there is clear accountability within the business on modern slavery.
Statements should be linked to the company’s homepage—this ensures other stakeholders, including investors, workers, and consumers can scrutinise business action on slavery.
Company statements must describe what action, if any, they are taking to tackle modern slavery within their business and supply chains.
This ultimatum, announced on Tuesday, is the culmination of some pretty poor news about compliance with the Act. A recent report by the Business and Human Rights Resource Centre on compliance within the FTSE 100—the group that might be expected to set an example to the 9,000-11,000 companies that are required to comply with the Act—came to the conclusion that more than half are not effectively complying with the Act’s requirements. There is also a general feeling among many of the NGOs that monitor compliance and that are signatories to the statement that compliance is poor.
“Businesses free from modern slavery must be the norm, something I believe everyone agrees. Therefore, flouting of this legal requirement can no longer be tolerated and by ‘looking the other way or failing to act’ those in leadership roles may themselves become complicit.”
Kevin Hyland, Independent Anti-Slavery Commissioner
Hyland clearly wants to ensure that compliance improves even after he has left his current role later this summer. The statement published on Tuesday has 35 additional signatories, including the Church Investors Group, the British Medical Association, the Trades Union Congress, Marks & Spencer, Stronger Together, Tesco, and Oxfam.
“Compliance with Section 54 has been weak to date,” reads the press release, “with many companies failing to produce compliant statements within the terms of the legislation.” The release says that a central registry would not only enable better scrutiny over compliance, but also “make it clear to businesses that Section 54 is a legal requirement, not a discretionary choice.” The U.K.’s “comply or explain” regime for corporate governance works well for that, but it appears that many companies think the regime applies to other areas that are in fact legal requirements. The release also notes that the Australian government published its own comparable bill on 28 June this year and that the bill includes a provision for a government-run registry.
Hyland said: “Clearly, a central registry would support better scrutiny both by government and others, such as investors, consumers, and other interested parties, and it would make it unavoidably clear that the Modern Slavery Act is not optional: Businesses must produce these statements, they must be legally compliant with the requirements of the Act, and the eyes of the world will be on them to assess whether they are playing a sincere role in this crucial effort.”
The statement itself references the report mentioned above, as well as another from Sancroft Tussell that says that over 40 percent of the government’s top 100 suppliers failed to meet the basic legal requirements of the Act and another from CORE saying that two-thirds of businesses analysed in high-risk sectors were found to have produced statements that failed to reference relevant slavery or human trafficking risks.
While the signatories are aware of independent, non-government-funded registries, such as the Modern Slavery Registry, they state that a single, publicly owned registry would reduce confusion in businesses about where to file their statements, make it clear that is a legal requirement, and enable other stakeholders to easily identify and read statements rather than having to navigate to individual company Websites.
The statement uses both the new Australian legislation and the U.K. government’s own recent launch of its Gender Pay Gap Reporting Service Website, to demonstrate that a modern slavery registry can be both possible and successful.