From where you are sitting, the risks presented by modern slavery may seem a world away, but a sound understanding of what constitutes modern slavery and how to play your part in eliminating it is critical for any ethically-sound organisation.
Depending on the size of your business modern slavery may already be on your radar, but it isn’t just something for big businesses to worry about as increasingly businesses and consumers consider such aspects when making purchasing decisions. So whether or not you are legally required to publish a modern slavery statement, doing so will send a clear message that your organisation takes these matters seriously and is playing its part. Here we look at what you need to consider.
Do you need a modern slavery statement?
Your business must have a modern slavery statement if it:
- Is a “body corporate” or partnership which carries on any part of its business in the UK
- Supplies goods or services; and
- Has an annual turnover of £36m or more.
What if your business doesn’t need a modern slavery statement?
Ethics and consumer pressures may well dictate that a modern slavery statement is something your business should have. But even if at first glance you don’t fall into the “must have it” category, you should check:
- Are you calculating your turnover correctly? For instance, turnover for these purposes includes the turnover of subsidiary companies, whether or not they operate within the UK. There are also guidelines which determine which elements of your turnover have to be taken into account
- Do any contracts further up your supply chain require you to have anti-slavery provisions in place?
- Can you identify any features which may impact on your obligations? Examples might include group structure, charitable status, franchises etc.
- Do you have other reporting obligations which might suggest that your organisation would benefit from having a modern slavery statement? One such example might be the requirement for UK quoted companies to report on human rights issues arising under the Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013.
How do you get started with your modern slavery statement?
Whilst your starting point will be your own organisation, the aim is also to increase transparency of modern slavery issues within your supply chains. To be clear, this isn’t about giving a cast iron guarantee that no slavery will occur in your organisation or your supply chain but you can take responsibility for what happens in your own organisation and take steps to make sure that those you do business with (whether directly or otherwise) do the same.
Steps you could take might include:
- Carrying out an assessment of risk within your own organisation which will take into account its structure, geographical spread, sector and supply chains, employment practices, pricing models etc. You should also identify what steps are currently taken to address the risk of slavery occurring. You may be doing more than you think.
- Preparing and circulating a policy advocating a zero-tolerance approach to slavery (ideally coupled with a whistle-blowing policy)
- Undertaking staff training to warn of the risks of modern slavery (including the reputational risk and potential financial repercussions for the business) and how to spot the warning signs
- Asking questions to understand what steps the organisations you deal with directly take to try and stop slavery occurring in their own businesses and in their own supply chains
- Incorporating terms in your contracts which require the organisations you do business with to undertake similar steps themselves (and to flow the same contractual requirements down through their own supply chains)
- Preparing (and, if necessary, publishing) a modern slavery statement (often referred to as a Section 54 Statement, so called because the requirements arise from Section 54 of the Modern Slavery Act 2015).
What should be included in a modern slavery statement?
There is no ‘one size fits all’ and no tick-box exercise for drafting a modern slavery statement. This can make the task of writing it both simple and daunting in equal measures. The following points provide a useful starting point:
- There are various pro forma modern slavery statements freely available. These can provide a good starting point but your statement should be bespoke to your organisation
- Your statement should be drafted in simple terms and, if your organisation operates overseas, you may also want to consider providing a translation
- You may need to incorporate information relating to any subsidiaries – so make sure you check
- You should identify what you perceive the main risks to be and refer to the steps taken to eliminate those risks, but you don’t need to list them exhaustively or in great detail
- If you have other policies (for example, on recruitment, procurement, employee conduct etc.) or accreditations which are relevant you should refer to them and provide links
- Where you are renewing a statement published previously, you must reference improvements made and further steps taken in the intervening period. However where no steps have been taken, you should say so
- Where your organisation is intending to focus on a particular issue over the next period, this should be referenced (as long as you then follow this up before the next statement is published)
- You should note how your organisation monitors its business to ensure its anti-slavery steps are effective.
If you have any doubts about whether you need to put a modern slavery statement in place, or need input on what it should contain, you may need to take legal advice.