Moving the needle on modern slavery

Nations are built on narratives – The Lucky Country, The American Dream – but scratch the surface and there’s more than a little nuance. The UN’s most recent Human Development Index rates Australia as one of the world’s top three countries for quality of life. Yet there are at least 15,000 people – roughly the population of Sydney’s bustling Surry Hills district – who are living in conditions of modern slavery, writes Henrik Smedberg.

Across industries ranging from beauty to farming, retail to construction, sex work to factory work, these people are facing daily threats, violence, deception and coercion. Sometimes power is exercised by an organisation, sometimes by an individual, according to the 2018 Global Slavery Index.

The issue of modern slavery looms even larger outside of Australia, among some of this country’s largest trading partners. Almost 60 per cent of the 40 million people living in slavery conditions worldwide are found in India, China, Pakistan, Bangladesh and Uzbekistan.

Henrik Smedberg

Australian governments have moved to tackle this problem with the passage of two laws in 2018 – the Federal Government’s Modern Slavery Act and the NSW Modern Slavery Act. This legislation acknowledges the underbelly of Australia’s lucky reputation – that it exists as a beacon of hope for those who seek a better life but many of them end up getting exploited.

It also recognises that being unaware when your business profits come from exploitation is no longer an acceptable defence. According to the Ashridge Centre for Business and Sustainability, there’s more than a 70 per cent chance that slavery exists in an Australian organisation’s supply chain. As Kevin Hyland, the UK’s first Anti-Slavery Commissioners  recently noted, if you haven’t identified slavery in your supply chain, it is likely that you are not looking in the right places.

Sunlight the best disinfectant

The point of these two acts is to get organisations to start looking – and reporting on what they find – so their efforts can be monitored, scrutinised and benchmarked. It’s an important step in stamping out this anachronistic scourge. Sunlight is the best disinfectant.

As two of the largest employers in Australia, the Federal Government and NSW Government will be eager to lead by example. They both manage large supply chains and have enormous spending power – almost 73,500 federal contracts with a combined value of more than $71 billion were published by AusTender in 2017-2018.

But there’s much more than a compliance story because research shows organisations that do good, do well. Media outlet Junkee found Gen Z Aussies care most about sustainability and the environment (95 per cent), gender equality (94 per cent) and social equality (93 per cent). They rank acting ethically as one of the most important characteristics of successful brands, second only to product quality.

Businesses that undertake procurement with purpose – rather than with a traditional emphasis on costs, control and compliance – set themselves apart with potential employees and investors. About half of the workforce would prefer to work for an organisation that has a positive impact on the world, with almost 44 per cent of people believing meaningful work was more important than salary. Organisations that embody a sense of purpose have three times more engaged staff.

Ignore slavery in the supply chain at your own risk

Those who ignore the potential for slavery in their supply chain face increased operational, financial and reputational risk. The same is true for government agencies, except in this case, those investors are the voting public.

The good news is that keeping track of what suppliers are doing has become much more manageable. Technology platforms like digital business networks provide newfound visibility into supply chains, enabling them to quickly and easily evaluate trading partners against huge volumes of data points and determine their exposure to risk, making more informed decisions.

Whether you’re a government agency or a business, getting started on the path to greater transparency involves a few steps – reviewing your forced labour policy, segmenting your supply chain by category and geography, monitoring continuously for risk signals, designing a risk assessment and controls framework, remediating identified risks and automating assessment processes.

Modern slavery can only exist where there’s demand for it, whether or not that demand fits within our national or business narratives. If we’re going to confine slavery to the history books, government and business must work in concert, always remembering that – now more than ever – doing good also means doing well.

Henrik Smedberg is Regional Vice President, SAP Ariba ANZ

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