UK Anti-Slavery day on 18 October was a stark reminder of the advent of the UK Modern Slavery Act (MSA) that came into effect two years ago. It coincided with an update to the statutory guidance issued by the UK government on 4 October.
The guidance provides an overview of the benefits of producing a MSA statement, and draws on best practice to guide organisations on what content to include, and how.
The story so far
It is estimated that between 12,000 and 17,000 companies are within the scope of the MSA, yet there are only 3,000 statements on the Modern Slavery Registry. Some companies are still failing to produce their first statements, whilst some reporters are not meeting the requirements fully. An analysis of FTSE 100 companies highlighted that 50% of companies are not providing meaningful information on whether their actions were effective in addressing modern slavery risks.
The requirements of the UK Modern Slavery Act 2015
Businesses with a turnover greater than GBP £36million, which are either incorporated in, or carry out business in, the UK, are required to prepare and publish a statement on steps that they have taken during that financial year to ensure that slavery and human trafficking are not taking place in their business or supply chain. Please see our detailed overview in our 2-page guide and blog on how the MSA impacts your business.
Statutory guidance was first issued in October 2015, and was updated on 4 October 2017.
The benefits of engagement depend on:
1 – Making your supply chain ethical and resilient
The MSA is becoming a powerful tool for organisations to quantify the prevalence of modern slavery and human trafficking within their operational footprint. It supports companies to identify opportunities to improve transparency and demand greater due diligence and monitoring of the risk amongst its supplier base. Currently, many companies still lack basic knowledge of and data on the country of origin of their raw materials and data, leaving them exposed to the risks of forced labour and trafficking.
2 – Improving external disclosure to align with stakeholder demands
The guidance states that even where organisations are not legally obliged to produce a statement under the MSA, those with a turnover less than £36m for example, they may still report voluntarily. Why? As we mentioned in our previous blog, Modern Slavery – no more hiding places for companies, the MSA is becoming a powerful tool for organisations to disclose their activities to the wider stakeholder audience of investors. Topics include the organisational structure, policies, due diligence, risk exposure, effectiveness at tackling modern slavery and training. Reporters will be well acquainted with reporting on these areas, whether through GRI, CDP, or through stakeholder requests.
3 - Demonstrating continual progress – and proving it
The guidance recommends that commercial organisations produce statements annually, even in years where the £36 million threshold is not met. This will allow businesses to effectively monitor their approach to addressing modern slavery, and demonstrate continuous progress to the external stakeholder community.
Our experience with MSA
At Anthesis, we have proven expertise and experience delivering support to businesses to comply with the Modern Slavery Act. We start by conducting an evaluation of your policies and procedures to address modern slavery, to identify gaps and the actions that need implementing to improve your approach.
See our case study on working with a global financial services organization to develop a robust Modern Slavery Statement that reflected and clearly set out how the company was addressing the issue and its plans moving forward.
Our proprietary risk screening and mapping tool RiskHorizon™ enables you to screen your supply chain to identify forced labour, trafficking and modern slavery risk hotspots. This enables you to prioritize actions for implementation based on a robust commercial footing and evidence-base.