Sedex insights report: Recognising forced labour risks in global supply chains, with data from 100,000 audits
Sedex’s latest report analyses data from over 100,000 social audits, to highlight the indicators of forced labour identified and their prevalence in global supply chains.
Forced labour is the most prevalent form of modern slavery, and often occurs in various sectors of the global economy. However, it is a particularly challenging issue for businesses to detect. Social audits play a significant role in many companies’ efforts to identify and address forced labour risks in their operations and supply chains.
Our analysis of over 100,000 social audits on the Sedex platform shows that social audits identify many signs, or “indicators”, of forced labour. These are sub-standard working conditions or employment practices recognised by the International Labour Organization (ILO) as signalling a potential risk of forced labour.
These indicators are areas of concern that Sedex recommends organisations always review closely, to decide whether further investigation or action is needed.
It is vital that organisations recognise that the presence of these indicators means there may be an increased likelihood of forced labour at a work site.
- Our report draws on data from more than 100,000 social audits, conducted across 158 countries from 2017-2021.
- Multiple indicators of forced labour are found in 36% of audits on the Sedex platform. Our analysis found that over 38,000 audits identified two or more indicators of forced labour, across numerous countries and industries.
- More indicators are found in countries predicted to have greater risks of labour rights violations. On average, more forced labour indicators were identified in audits of work sites in countries defined as “high risk” in Sedex’s risk assessment tool [i].
- More indicators are found on average in audits in the lower tiers of the supply chain, where visibility and influence of buying companies is more limited. In our analysis, the highest number of forced labour indicators per audit is found at crop and animal production supplier sites. These suppliers typically exist in the lower tiers (the beginning) of a supply chain, where it is usually harder for buyer companies to have full visibility of work sites and conditions.
- Excessive overtime is the most common forced labour indicator found in audits. While the use of overtime itself is not problematic, excessive and illegal overtime increases the risk of forced labour if it is accompanied by coercion and workers do not feel that overtime is voluntary.
- Ensure your organisation has a thorough responsible sourcing due diligence programme, including contractual requirements for suppliers that prohibit forced labour.
- Look closely at indicators of forced labour when an audit, or other form of assessment, identifies them. Every indicator is an alert sign – and some indicators are strong evidence of forced labour – that requires reviewing, so your organisation can decide whether to investigate further, or needs to take action to protect workers.
- Conduct a risk assessment to increase your understanding of forced labour risks in different parts of your supply chain. This will help your organisation to prioritise where they target their resources and activities to reduce these risks.
- Work with suppliers to understand and address the issues that indicators raise. Even if forced labour is not occurring, every indicator represents an opportunity for an organisation to improve conditions for workers.
- Where multiple indicators are detected, pay particular attention and investigate the situation at a work site. Generally speaking, the more indicators found in an audit, the more important it is to investigate the situation.
- Engage workers directly, through worker organisations and by using worker voice tools, to gather anonymous feedback about their experiences and working conditions. This will help your organisation build a more detailed picture of the conditions at a site, to better identify forced labour risks and evaluate the effectiveness of preventative measures.
- Recognise excessive overtime as a practice that can increase the risk of forced labour – even when it is common in a country or industry. Engage with your suppliers to understand and address the root causes of excessive overtime together.
[i] Based on the Combined Overall Risk category score assigned to countries by Radar, Sedex’s risk assessment tool