A UK coalition designed to combat modern slavery launched today at the London Stock Exchange, headed up by charity fund manager CCLA and backed by the likes of the Principles for Responsible Investment (PRI) and the Investment Association, the fund management industry body.
The initiative, called ‘Find It, Fix It, Prevent it’, will appoint lead and support investors to engage with listed companies on modern slavery in their supply chains, in a ‘Climate Action 100+ style’ engagement starting with the hospitality industry.
Knowledge building and lobbying on policy will also be used as tools to “root out slavery and address it”, with participants being asked to sign an investor statement at the launch.
There are around 25m people – more than the population of Australia – living in a state of forced or compulsory labour, in servitude or having been trafficked.
Peter Hugh Smith, the new CEO of CCLA, said: “This is not just sweatshops in the Far East. This is people in the agriculture industry in the UK. This is trafficking. This is everywhere.”
CCLA is currently fronting the costs of the campaign to the tune of a “six figure number”, with a view to other investors stepping in to support the initiative as it develops. The PRI and Investment Association have also offered backing.
James Corah, Head of Ethical and Responsible Investment at CCLA, said: “We believe it makes a difference to how companies and portfolios perform today – as well as in the face of systemic challenges that are coming down the road – but what we also find lacking right now is a little bit of moral leadership in the investment industry.”
Corah said dialogue with companies would start by asking whether firms had found slavery in their supply chain. “It is our firm belief that modern slavery exists in every supply chain somewhere, so the right answer to that question is ‘yes’. If the answer is ‘no’, we’re asking, ‘How hard are you really looking into this?’”The coalition will produce an annual “progress statement” which Corah said wouldn’t initially name and shame underperforming companies.
Hugh Smith added: “The challenge here is we’re not trying to vilify the companies that we’re engaging with. Slavery is horrendous, but if companies start being vilified for it, then they’re not going to look for it in their supply chains.” He said further down the line the report may identify leaders and laggards.
CCLA has ambitions for the effort to become more international in its target companies as it grows.
The Business & Human Rights Resource Centre and the University of Nottingham Rights Lab are among the NGOs and academics supporting the project.
The launch of the initiative follows on from CCLA and Rathbones’ September response to the UK’s consultation on its Modern Slavery Act, which saw them “strongly advocate mandatory reporting” for all listed companies with the backing of investors with £2.4trn in assets under management.
Corah said the initiative’s public policy aims are to deliver on the consultation response and create a “meaningful Modern Slavery Act”.
It is just the latest in a string of big moves around human rights and modern slavery from hard hitters in the market, legislators and NGOs.
The Liechtenstein Initiative – the public-private partnership headed up by PRI CEO Fiona Reynolds – launched the Finance Against Slavery and Trafficking project in September – the same month Sweden’s AP2 revealed plans to develop an “in-house quantitative data model” to get a more complete picture of the human rights risks in its portfolio.
And the Swiss Parliament looks set to approve mandatory human rights due diligence for domestic businesses, after 23 global investors, representing €360bn in assets, called for the upper house’s support.