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Thursday, August 28, 2014
- Shareholders are calling on 15 U.S.-based multinational corporations to ensure that their global supply chains are not facilitating human rights abuses, particularly labour and sex trafficking.
In a new campaign running throughout January, the Interfaith Centre on Corporate Responsibility (ICCR), which represents 300 shareholder organisations managing around 100 billion dollars in assets, is focusing on two sectors in particular, hospitality and food agriculture. These industries – which include hotels, airlines, restaurant chains, large retailers and agribusiness companies – are seen as particularly at risk for rights violations.
“To properly fight abuses like human trafficking, we all have a role to play – and business must become part of the solution through putting into practice respect for human rights and ensuring their partners, suppliers, subsidiaries and agents do the same,” Amol Mehra, director of the International Corporate Accountability Roundtable, a network based here, told IPS.
“Business has a responsibility to respect human rights, but this is more than just compliance with domestic laws. Instead, business must ensure that they, throughout their business relationships and including within their supply chains, avoid negatively impacting human rights and engage in appropriate judicial remediation when violations do occur.”
ICCR is now urging 15 U.S.-based corporations in particular to take a series of steps in this regard. These include agribusiness giants (ADM and ConAgra), retailers (Costco, Kroger, Target and Walmart), airlines (Delta, US Airways and Southwest), hotel chains (Hyatt, Starwood, Choice) and others.
The group’s members recently released a new set of principles and recommendations that would lead companies to make specific declarations to ensure that the entities within their supply chain will comply with a host of international agreements aimed at cracking down on various forms of human trafficking, including the U.N. Guiding Principles on Business and Human Rights, passed in 2011.
Companies are also urged to publish regular updates on steps taken in this direction, as well as analysis of their impact.
“These are not aspirational recommendations – they’re very practical and very much based on ongoing and emerging practice,” Lauren Compere, an ICCR board member and managing director at Boston Common Asset Management, a social investment firm, told IPS.
“We started to really engage on how to implement the Guiding Principles, taking our practical experience over the past 15 years of engaging on child labour, human trafficking, modern-day slavery. These principles offer a roadmap for companies to take to engage on this.”
ICCR has a standing relationship with each of the 15 companies, which Compere and others feel could be particularly amenable to talking about additional steps to safeguard their supply chains.
“Where companies generally still miss the grade is on disclosure, especially within the hospitality sector. Disclosure on mitigating risks around trafficking really needs a lot more systematic, standardised reporting,” she says.
“For the moment, most of the information that is available is anecdotal, without data even on the percentage of operations that are covered. Some companies are getting better on general human rights disclosure, but we’re not seeing that yet on human trafficking.”
On dealing with grievances or the mitigation of risks, she says, in many companies there is still no real understanding of the full impact that corporate policies are having.
Estimates on the size of the global human trafficking problem are notoriously difficult. According to the International Labour Organisation, around 14.2 million people were thought to have been engaged in some form of forced labour in 2012, while another 4.5 million had been coerced into sex work.
Others say these numbers are likely far higher, with global numbers perhaps topping 30 million.
ICCR became involved in the intersection of corporate responsibility and trafficking in 2006, when a group of Scandinavian investors began pressuring the Marriott hotel chain over reports of child prostitution rings making use of the some of the company’s facilities in Costa Rica. Within a year, Marriott had rolled out a new, pointed policy on the issue, and has since engaged in annual shareholder disclosure.
While Marriott was never accused of knowingly facilitating these exchanges, the lack of stated policy was seen as detrimental to broader anti-trafficking efforts.
“Hotels, motels and others in the entertainment sector are all vulnerable to sex trafficking, and we’ve seen that if these types of businesses open their eyes they may find trafficking taking place within their operations,” Karen Stauss, director of programmes at Free the Slaves, an advocacy group here, told IPS.
“While agriculture is a bit different, all across the world this is a sector where workers are very ill-paid, often coming from rural areas where they may not have a strong education, including on their rights. Without a doubt there is no way that we’ll solve the human trafficking problem until multinational corporations get involved – they have huge buying power and thus can access much farther down the supply chains.”
Pressure from consumers, advocacy groups and national and international regulation has had an increasing impact in recent years, with more and more companies recognising that actions taken throughout their supply chains can be a damaging liability. Further, Stauss notes that the use of, for instance, forced labour typically offers profits only far down the supply chain, with little to no positive effect for parent companies.
“Unfortunately, we still constantly see companies using the language of ‘impossibility’, claiming that their supply chains are so long that it is impossible to tackle these problems,” she says.
“The way I see it, this is just a lack of vision and creativity. The information and communications technology industry, for instance, has been pushed to take this on [due to U.S. legislation] and we’re now seeing that sector doing things that five years ago they said were impossible.”
Yet while recent federal legislation here is starting to have an impact on certain industries – such as the electronics sector – at risk of using so-called conflict minerals, there is currently no broader U.S. law requiring corporations to take steps to ensure that their supply chains are free of human trafficking.
Important precedent in this regard has come from California, however, which in 2010 passed landmark legislation requiring such regular disclosure for certain large companies (related information is available here).
While efforts to adopt a similar law at the federal level failed during the last congressional session, Stauss says supporters are expecting a new such bill to be introduced in coming weeks – and notes that the coalition of lawmakers and stakeholders in favour of such a law has continued to grow.