What can we learn from the retail and FMCG sector’s modern slavery approach?

As part of our ongoing modern slavery awareness campaign (see previous blogs here) we are shining the spotlight on the retail and FMCG sector’s approach to managing modern slavery risks.

When we talk about retail, we’re talking about a wide range of products, from food and clothing to electronics and home goods. Similarly, FMCG stands for Fast-Moving Consumer Goods. These are products that are sold quickly and at relatively low cost. FMCG items are typically non-durable goods that consumers use on a regular basis, such as: 

• Food and beverages 

• Toiletries and personal care products 

• Household cleaning products 

• Over-the-counter drugs 

• Paper products 

These sectors have some unique characteristics. From the consumer perspective, there’s frequent purchases, with little or no effort to select products, low prices, short shelf life and rapid consumption.

From the business perspective there’s high volumes, low contribution margins, extensive distribution, and high stock rotation. These characteristics can have a huge negative impact on the people within its operations and supply chains and, can in and of itself cause and contribute to modern slavery.

See below how many retail and FMCG goods are included in the list compiled by the United States Department of Labour for goods produced by child and forced labour. Note how many you likely buy on a weekly basis! I know for me big ones are coffee, chocolate and clothes made of cotton. 

Combine this prevalence with consumers and activist groups demanding action on human rights and modern slavery, this has resulted in many retail and FMCG organisations attempting to address this issue for some time now. Whilst the sector may not always get it right, there are some key initiatives that other sectors can certainly learn from. 

1. Use of workers voice 

The UN Guiding Principles and the OECD Guidelines on human rights due diligence call for meaningful engagement with affected stakeholders. Many retail and FMCG organisations have adopted tech solutions, such as Ulula worker voice technology, which empowers anonymous real-time communications within supply chains to reduce risk, respond to challenges, exceed compliance requirements, improve productivity and help advance working conditions around the world. 

2. Beyond audit approach 

Audits can help with identifying and managing risk, but their scope is often limited. To meaningfully take action on modern slavery, audits should be used alongside more comprehensive human rights due diligence. This is often called a ‘beyond audit approach’.

Examples include M&S with human rights training for procurement teams and reviewing data from worker voice technology. Mars’ Next Generation Supplier programme which uses tools, technologies, and an innovative collaboration model to help suppliers deliver better results for people in their workplaces. Unilever work directly with partners to build skills and develop capabilities across important issues such as eliminating forced labour, avoiding child labour, paying fair wages for reasonable working hours, management systems, fire safety, and the environment.  

3. Collaboration 

Finally, my favourite (because I love chocolate!) Tony’s Open Chain, which is an industry-led initiative that helps chocolate brands transform their cocoa supply chains. Members include Tony’s Chocolonely, Aldi, Ben & Jerry’s, Flower Farm, Jokolade and Albert Heijn.

The chocolate companies work together through Tony’s Open Chain, setting a new industry standard to end modern slavery and illegal child labour in cocoa. By adopting the five Sourcing Principles they drive structural change towards a more equally divided cocoa chain. These principles are traceable beans, a higher price, strong farmers, the long term productivity and quality.  

Interested in how we can help your organisation with your modern slavery strategy? Get in touch with our expert Anna. 

 

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