Supply chain ethics and traceability among biggest business human rights issues, report finds

Increasing supply chain traceability and integrating human rights into the adaptation and mitigation of climate change impacts are among the most significant human rights issues effecting sustainability and CSR professionals.

The ongoing migration crisis stretching out across the globe is an emerging driver in forced labour occurring in company portfolios, according to the report

The ongoing migration crisis stretching out across the globe is an emerging driver in forced labour occurring in company portfolios, according to the report

That's according to a new report from global risk advisory firm Verisk Maplecroft, which analysed the top 10 significant issues that businesses are now faced with when tackling human rights matters.

A lack of information on supply chain practices and the adaptation of climate impacts ranked alongside the recruitment of migrants and refugees into forced labour as some of the biggest threats to brand reputation over the next 12 months, the researchers claim.

“The risks for business are amplified by increasing public scrutiny of unmapped tiers of the supply chain and benchmarking of company human rights performance,” said Verisk Maplecroft's principle human rights analyst Alexandra Channer.

“Damage to hard-earned brand equity, consumer backlash, and divestment by ethically focused investors pose real threats to companies who are found to be knowingly or unknowingly complicit in abuses.”

The Human Rights Outlook 2016 report states that new mandatory reporting requirements from legislation, such as the UK Modern Slavery Act, coupled with greater public scrutiny of supply chains, has led to the exploitation of migrants and refugees in supply chains being named as the most pressing reputational risk.

The report also recognises the ongoing migration crisis stretching out across Europe as an emerging driver in forced labour occurring in company portfolios. The current migration issues and the growth of ‘labour brokers’ have been identified in the report as central drivers leading to perpetual modern slavery.

Conflict minerals

The report expects public benchmarking of business practices to increase in 2016 as the shift from voluntary to mandatory reporting – which has taken place in modern slavery and conflict mineral sourcing – continues to develop.

It notes that, while numerous businesses have adopted strenuous monitoring condition across ‘tier one’ suppliers, many have little visibility of the distant tiers of their supply chains and are therefore unprepared to meet the expanding challenges.

The report also raises concerns over the traceability of metals and minerals in supply chains – with increased emphasis on conflict minerals in the ICT manufacturing sector.

American technology giant Intel is one company which has already agreed to source non-conflict minerals, and is using public consumer morality to encourage other companies to make the pledge. UK telecoms firm BT has also launched a seven step assessment tool that allows them to assess suppliers concerning the company’s existing sustainability measures.

Paris and beyond

Goal Eight of the Sustainable Development Goals covering the subject of working conditions, and the historic climate deal in Paris at the end of 2015 businesses agreed that businesses must increase efforts to ensure their supply chains are not contributing to deforestation.

The Maplecroft report states that climate mitigation must be taken into account by businesses to ensure that workers in the supply chain aren’t affected by the changes. The report concludes that collaboration between international organisations, governments, business and NGOs will be vital in creating solutions to these risks.

It also calls on a new toolbox to be introduced to help companies with the issues. Human rights training, rewarding partnerships and creating ethical leaders would also reap dividends in relation to brand performance and equity.

Speaking exclusively with edie this week, Britain's largest food redistribution charity FareShare stated that food waste campaigners should stop 'beating up the supermarkets' and instead look further up the supply chain at the untapped redistribution potential of thousands of processors and manufacturers.

Matt Mace


ethics | supply chain | sustainable development | traceability | CSR reporting


CSR & ethics
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