Erasing Modern Slavery's Footprint
When HR takes the time to make sure its organization is sourcing its labor needs appropriately and avoiding forced labor, it's is not only the right thing to do, experts say, but it has real, positive business consequences.
By Jill Cueni-Cohen
While slavery in America may only live on as a sad chapter in our nation's history books, HR executives at multinational corporations still face the age-old issue of slave labor existing in their supply chains, and that topic was recently brought to the forefront when President Obama launched a White House initiative to end modern slavery, called Made in a Free World.
One year ago, Slavery Footprint, an Oakland, Calif.-based nonprofit organization, began making consumers aware of the fact that slavery is now more prevalent in the world than it ever was before. Using an interactive website, people can calculate how many forced laborers were likely involved in the manufacture of products they use every day. Results from completed surveys show that most people have an average of 34 slaves working for them.
According to U.S. State Department Deputy Director Alison Kiehl Friedman, based in the Office to Monitor and Combat Trafficking in Persons, more than 27 million workers around the world are being forced to do their jobs.
"With so many of them trapped in agriculture and mining industries," she says, "slaves are involved in a lot of the goods that we use."
Made in a Free World uses the Slavery Footprint tool to help companies identify where forced labor may exist within their supply chains. They then work with independent auditors, such as VeritÃ© and the Fair Labor Association - two internationally recognized non-government organizations in human rights - to ensure that no forced labor is used in the making of their products.
Justin Dillon, founder and chief executive of Slavery Footprint, says that addressing the issue of human trafficking on a company-wide level is the first step in eradicating it. "This is something your entire company should have some understanding of," he says, noting that starting a dialogue with employees and having them take the slavery footprint survey will strengthen corporate engagement. "Every company has its own cultural space, and an office is a way for individuals to participate."
Susan Kohn Ross, a Los Angeles-based international-trade attorney at Mitchell Silberberg & Knupp, counsels multinational companies on issues of voluntary disclosures, and says the risk of forced labor in their supply chains is something companies have been aware of for a long time.
"There is a federal law that has been on the books for more than 25 years that bars the importation of goods made with slave labor," says Ross. "Typically, most large companies have third parties who do social accountability audits on their suppliers, but this issue has gotten a lot more traction under the Obama administration."
Tackling world-wide slavery sounds daunting, but companies that do so will reap unforeseen benefits. Says Friedman, "One of the things that we have found that has been compelling companies to take the time to make sure they're sourcing labor appropriately, is that not only is it the right thing to do, but it has real, positive business consequences. Establishing best practices to address human trafficking will ensure that you hire the best-qualified people; who are happy and committing to a job where they know what they're committing to."
Friedman explains that workers are often unwittingly lured into situations where they become trapped. "An unhappy workforce diminishes the quality of the product and causes delays, because people who don't want to be where they are don't usually have the requisite skills. Companies that eradicate forced labor in their supply chains realize long-range savings and added brand value and reliability," she points out.
Dan Viederman, CEO of VeritÃ© works with companies to help them understand what risk they face in terms of forced labor in their supply chains. "Then we help them to put in systems to eliminate forced labor, child labor, systematic discrimination, health and safety violations, and a whole range of problems," he says.
Made in a Free World doesn't point fingers, it looks for solutions. "Boycotting doesn't free anyone, it leaves them enslaved and contributes to further depressed economic conditions," says Friedman. "For HR people and procurement executives in general, they fear having to totally change up their suppliers, but there are simple things you can do to make sure workers are respected and free, and this doesn't mean radical changes."
Recruitment fees, especially for migrant workers, are at the crux of the problem. "There is currently a trend of moving away from paying any recruitment fees whatsoever," she says, "because oftentimes workers have paid so much to get their jobs that it puts them so deeply in debt that they will never realize the salary. They put themselves and their families up as collateral and can't surmount the debt. Then the recruiter knows where their family is and threatens them. Those risks compound themselves, and having a straightforward policy would stop that."
Viederman adds, "Workers who aren't free to leave their jobs become indentured servants, and this makes them much more susceptible to sexual abuse, underpayment of wages and harassment; because the stakes are very high for someone who's taken on debt to get a job."
A handful of companies are currently working with Viederman on this issue, but he can't disclose names, because of the stigma that solving a slavery problem means you have a slavery problem. However, many companies will soon find that there's more to compliance than just voluntary membership in the Customs-Trade Partnership Against Terrorism, which was launched in 2001 and now has more than 10,000 member companies.
"These days, if a company makes claims that they're compliant, they have to actually be compliant, or they can open themselves up to lawsuits," says Ross, noting that consumer awareness calls more attention to the issue.
"There are a number of powerful institutions lining up to hold companies accountable," says Viederman, adding that any company engaging with the federal government must now prove that their products are slavery-free. He points to the 2010 California Transparency in Supply Chains Act, which took effect on January 1, 2012. "The act requires companies to disclose steps they've taken to ensure there's no forced labor in their operations. We're also working with the staffing industry itself, to get the biggest employers in the world to demonstrate that there is a right way to do this. And this will create pressure on those who would rather cut corners."
Ross says that the following three steps can safeguard companies. "First, verify employee I-9 forms; step two is to look at the existing security protocols and membership in C-TPAT; and step three is to make sure you have a board resolution that gives the right importance to human-rights issues."