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Why Business Needs to Talk About Modern Slavery – A Roundtable Discussion with Matt Friedman, Mekong Club and Darian McBain, Thai Union PLC

August 4, 2020

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We had the pleasure of hosting a virtual discussion with Matt Friedman, an international modern slavery expert and CEO of Mekong Club, together with Dr. Darian McBain PhD, the Global Director of Corporate Affairs and Sustainability at Thai Union, one of the world’s largest seafood processors.

It is estimated that there are over 40 million people in modern-day slavery today, and of these, 60% are associated with manufacturing supply chains.

Matt has worked with the United Nations Inter-Agency Project on Human Trafficking and the United States Agency for International Development and is the author of twelve books, including Be the Hero: Be the Change.

Darian is a globally-experienced sustainability and communications executive. Since joining Thai Union in 2015, she has shifted the businesses approach from a commodity focus to a wholistic ecosystem with a focus on oceans and people. She has driven the company’s sustainability strategy, SeaChange, that focuses on traceability and transparency and is looking to technologies, such as blockchain, to solve critical issues, including the elimination of human trafficking and forced labour.

Matt and Darian led a very interesting discussion with our professionals, providing a comprehensive update on the global trends of modern slavery and practical strategies to identify and address this potential problem in the private sector.

The Mekong Club is one of the first not-for-profit organisations of its kind in Asia to use a ‘business-to-business’ approach to fight slavery. Bridging the gap between the public and private sectors, the Mekong Club supports companies of all sizes to understand the complexities of human trafficking and to reduce their vulnerability within their supply chains and business environment.

According to Matt, the world currently has more people living in slavery than at any other time in history. The profits generated by modern slavery – formerly described as human trafficking – are believed to total about US$150 billion per annum. In stark contrast, only US$350 million or 0.2 per cent of profits, is being used to fight the real and devastating impacts of modern slavery.

Some countries have legally recognised the need to eradicate modern slavery, and the key role private companies play, particularly in the supply chain arena. Matt provided the example of California passed the Transparency in Supply Chains Act in 2012 to ensure large retailers and manufacturers provide consumers with information about their efforts to stamp out slavery from their supply chains, and educate consumers on how to buy goods produced by companies that responsibly manage their supply chain.

Further, the Modern Slavery Act 2015 in the UK includes a supply chain clause so that ‘big business will be forced to make public its efforts to stop the use of slave labour by its suppliers’. In 2018, Australia also introduced the Modern Slavery Act that encompasses servitude, slavery, child labour, forced labour, debt bondage and deceptive recruiting for labour or services. Businesses with a minimum annual consolidated revenue of $100 million must report modern slavery risks in their operations and supply chain, and respond to those risks.

Matt says with each incarnation of legislation, there is growing emphasis on the private sector’s role in both unearthing and eradicating slavery. He believes no private sector can afford to avoid the issue due to the real threat of law suits and reputational damage. For example, some retail outlets buying cocoa, palm oil and fish are being sued due to these products involving slave labour. Manufacturing, retail, hospitality, construction, technology and pharmaceutical businesses all face potential exposure to risks.

Matt argues that businesses in Australia must have a clear understanding of responsibilities and requirements under the Modern Slavery Act. He believes corporate affairs professionals can play a critical role in proactively leading their organisations to undertake a review of their supply chains in mitigating company risk and ensuring their supply chains are not vulnerable to modern slavery practices.

The Mekong Club works with the private sector to pinpoint ways to help businesses understand what they must to do address modern slavery. The process begins with understanding modern slavery, enhancing policy and procedures by developing a framework, assessing and mitigating risk, developing the skills needed to manage the ongoing process, and becoming a leader for others in industry to follow. A flowchart is designed with specific actions so people know what they must do and how.

Darian says that years ago, when the issue of modern slavery was raised, most corporates would ‘run a mile’. Today that isn’t an option. Thai Union faced challenges in dealing with modern slavery including illegal fishing, potential bans if regulations weren’t improved, the suspension of diplomatic ties, law suits and angry customers. Thai Union also became a target of Greenpeace. “So, we started on a journey to embrace that modern slavery is a challenge in the supply chains and what could we do to really make a change?” she says.

Thai Union’s answer was SeaChange, a four-pillar sustainability strategy that includes a pillar of ‘safe and legal labour.’ All workers are treated fairly and with dignity and have safe and freely-chosen employment. Supply chains, from vessel to factory, comply with labour regulations and Thai Union’s Business Ethics and Labour Code of Conduct. Thai Union receives information about the labour practices on board vessels and liaises with industry, government and society to move towards lasting improvements in labour practices across the seafood industry.

Darian says that the COVID-19 pandemic exacerbates the devastating personal impacts of modern slavery and the vulnerabilities of the world’s most in need as people struggle to find jobs.

She says while businesses can’t tackle all aspects of this significant issue at once, they can gradually introduce initiatives to begin to deal with modern slavery impacts. Some of the practical strategies she outlined include partnering with activists, talking to workers, endorsing ethical recruiting, identifying any red flags that suggest money laundering activities, setting up a hotline for whistleblowing and establishing worker welfare committees.

“You need to think of modern slavery as a real human issue,” says Darian. “Once you have seen where modern slavery is, how it’s happening and how you as a business can have an impact on people’s lives, then you cannot really turn away from it.”

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The views and opinions in these articles are solely of the authors and do not necessarily reflect those of Teneo. They are offered to stimulate thought and discussion and not as legal, financial, accounting, tax or other professional advice or counsel.

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