Why A Neutral Central Registry for Company Transparency in Supply Chains Reports Is Key

29/07/2016 11:16 | Updated 29 July 2016

In March 2016 Section 54 of the UK's Modern Slavery Act - Transparency in Supply Chains etc. (TISC) provision took effect. It required businesses with a global turnover of £36 million or more and doing business in the UK to publish an annual statement about their efforts to tackle slavery in supply chains and their own organisation.

TISCReport, a central registry of transparency statements, was launched on 21st March 2016 at an event hosted by Karen Bradley MP, the then Minister for Preventing Abuse, Exploitation and Crime attended by 80 businesses. The registry aims to increase transparency about modern slavery and help consumers and others to understand what actions businesses are taking to combat this illicit trade. The register will not tier or benchmark businesses, but will provide a single access point for academics, businesses, government and non-government agencies to assess the quality of the statements and follow up on any promised actions. It is targeted at all groups: the general public, consumers, investors, business and non-government. TISCReport has been created as a social enterprise to provide a neutral platform on which businesses can demonstrate their commitment to tackling modern slavery, and engage consciously and proactively with this important issue.

During the passing of the Act, and since, there has been a growing call for the potential systemic and global impact of the transparency legislation to be fully realised. A partnership between Unseen and Semantrica has created this central registry, through which we want to enable the role of civil society, consumers and investors, to encourage businesses to race to the top by tackling the illicit trade in the exploitation and commodification of human beings. By creating a neutral central registry, we will enable all company reports to be easily accessible in one location on the web. This will allow for easy comparison of reports and it will, over time, highlight development and innovation, enabling greater analysis to take place, and ensuring the race to the top culture we are all seeking to achieve. Critically, it is already backed by astute businesses and umbrella organisations such as the Chartered Institute of Procurement & Supply, International Chamber of Commerce, Business West Initiative and the Wales Anti-Slavery Co-ordinator.

David Noble, Group CEO of CIPS said this: "The central register will enable businesses to clearly demonstrate the steps in their journey to a slavery-free supply chain. By storing the statements in one place we will be able to highlight areas of best practice and aid businesses to learn from each other. I believe that a collaborative approach within or across sectors will help everyone to eradicate this atrocious crime."

But the key to all of this is the registry's neutrality. There are many who want to rank and benchmark companies regarding their response to modern slavery, and they are completely free to do so. This has a role and a place, but surely it is a fundamental mistake to conflate the two issues of registry and benchmarking?

The UK Government estimated that approximately 12,000 companies would be covered by this legislation. The problem with benchmarking is, to date, it has concentrated on a small number of companies and a minimal number of industry sectors. This world leading legislation covers all companies and all sectors over the financial threshold. By requesting companies to file voluntarily it encourages their proactive engagement with the both the transparency and modern slavery issues as opposed to something that is done to them by scraping their reports from the web and grading them.

There is a real danger that benchmarking will end up incorrectly comparing companies from completely different sectors, operations, and typology. In my first job, retail management, we had a saying: "don't compare apples to oranges". They may both be fruit, but they are very different fruit. Can we really compare companies, one to the other? And what exactly are we benchmarking - the reports or the actual steps a company is taking? The company report, according to the legislation, should be a record of all the steps taken by a company to combat modern slavery - good, bad or indifferent. The report may or may not be wonderfully drafted, but surely it is the actual steps taken that are most critical.

For instance, say modern slavery is a new issue for Company X. They could be ranked poorly for the first few years because they are stating that they are assessing the issue, developing an action plan and making tentative steps forward. The fact that they have taken a positive step by engaging with the issue - which seems the most important - is given no credit. Yet Company Y, which has been engaged with this issue for a number of years, and is also in a completely different sector, is ranked highly because they can put out a 'wonderfully' comprehensive report, although they may not have delivered any real change at all. It also seems impossible to objectively compare, say, a petrochemical business to a financial institution, or an import and export company to a service sector business. Equally difficult is the scenario of a company reporting it has found modern slavery: is this viewed as 'positive' or 'negative'? Or, if, given the scale of an operation, a company prioritises its response and so delays in other areas, is this pragmatic, positive or negative?

If we are to truly tackle the complex issues of modern slavery, especially in supply chains and business practices, we must learn to collaborate together positively. Constantly criticising practice is never the most productive method of bringing about real change. Business has a vital role to play in helping to eradicate modern slavery; therefore, creating a positive environment where business can begin to get to grips with all the multifaceted issues, is vital.

There is no good economic case for allowing modern slavery to be complicit in legitimate businesses, let alone the moral imperative. We have to stop it. Effectively tackling modern slavery can affect positively both the numbers above and below the line; what will result is decent work for all, all the way through the supply web. Globalisation, whilst lifting millions out of poverty, has also trapped millions in situations of modern slavery and forced labour. This illicit supply and demand trade in human beings, fuelled by a demand for cheap goods, cheap services and cheap labour and pure greed has unfortunately been exacerbated by the global business model of rapid time to market, procurement predicated on a model of profit margin alone, and an addiction to an extractive profit model of capitalism. Sadly, the result of this is slavery, embedded in the supply webs that span our globe. But castigating business is not the way forward.

Business, without doubt, can be the force for good we need. Positive engagement, by encouraging and unleashing the creativity of business to tackle this issue, could be a vital and major step towards a fairer, freer world. The neutral central registry has the potential to create that space for brave first steps, for pre-competitive and cross-sector working to tackle deeply entrenched problems and for forward leaning companies to set the pace to which others will aspire, driven by the knowledge that the wave of transparency is gathering apace and fundamental societal and generational shifts are taking place driven by Millennials and Generation Z who are the global citizens of now.

The Modern Slavery transparency legislation is but a few months old, and TISCReport offers a neutral space where real change can begin. Scraping plus benchmarking, with its potentially unhelpful comparisons, could kill off the first shoots of real transformative change. A neutral registry combined with a positive collaborative approach seems surely the positive way forward to deliver what we all want: an economy and world without modern slavery.