Most business leaders agree that addressing modern slavery risk is a key priority, but just half report making effective progress on the issue, according to a survey by Gartner Inc.
The survey of chief procurement officers (CPOs) found that 71% of sustainable procurement leaders see the issue as a priority, but that they cannot rely on achieving supply chain visibility alone to identify where adults and/or children are victims of forced labor. Instead, CPOs must take a series of ongoing, proactive actions to mitigate and remediate forced labor being used within their organizations’ supply chains, Gartner said.
“Modern slavery is a risk to almost all supply chains,” Laura Rainier, senior director analyst in Gartner’s Supply Chain Practice, said in a release. “It’s also one of the most challenging risks CPOs have to address; rooting out the practice requires visibility into multiple tiers of suppliers and a willingness to address issues in areas of the supply chain that traditional due diligence processes often fail to reach.”
Gartner completed its global survey in May 2023 of 104 procurement leaders that had recently participated in a sustainability initiative on their organizations’ progress in addressing modern slavery risk.
“Procurement leaders who have made progress on multi-tier supplier visibility should feel encouraged as accomplishing this step alone can be an overwhelming task,” said Rainier. “Once a baseline of visibility is achieved, however, procurement leaders need to embrace the ongoing work that is required to accurately monitor and mitigate the risks associated with the use of forced labor in global supply chains.”
Gartner recommends that CPOs start in addressing modern slavery risk with a focus on building greater visibility into their supply chains, including prioritizing the Tier-2 and Tier-3 supplier relationships most at risk via geography or commodity source. Achieving data visibility among these suppliers requires a mix of incentives, contractual obligations, and technology.
According to Rainier, CPOs also need to take a series of actions beyond improving supplier visibility, including five broad steps:
- set and cascade policies through a supplier code of conduct,
- conduct supplier trainings, teaching them to conduct due diligence on their recruitment agencies and upstream suppliers,
- assess suppliers and verify that local site auditors speak the language of workers,
- remedy issues that are uncovered in audits by addressing the root cause, and
- embed risk mitigation throughout the supplier lifecycle, starting with supplier selection and onboarding through contracts, scorecards, and remediation policies.
