Businesses have been warned they risk major reputational problems and a potential PR disaster if they fail to comply with the new Modern Slavery Act.
A new blog post from leading food industry solicitors, Roythornes, warns that, while the legislation does not impose financial penalties on companies that fail to comply, the adverse effects of being prosecuted for failing to do so could lead to suppliers, journalists and members of the public asking serious questions about a company’s business practices. The post, by Rebecca Brook-Smith, explains that companies with a turnover in excess of £36m per annum must now, by law, produce a ‘slavery and human trafficking statement’.
This should set out information such as:
- supply chain information
- company policies on preventing slavery and human trafficking
- due diligence details on ensuring slavery and human trafficking does not occur in the company’s supply chain both in the UK and overseas
- potential risks and what is done to mitigate them
- details of training for staff in relation to the issue
Big businesses, the post suggests, should pay particular attention to the statement and the amount of time and effort applied to the creation of such policies should be proportionate to the size of the business and the risk it is exposed to. It also advises that activist groups will likely look closely at how well companies follow the new legislation to bear and put pressure on companies who fail to act. Head of food and drink at Roythornes, Peter Bennett, said: “We’re being asked more and more questions about the Modern Slavery Act and how businesses can meet their obligations under it. “The key point is that businesses should not be tempted to simply rest on their laurels because there is no financial penalty within the legislation. The punishment for failing to meet your obligations under the act could potentially be decided by the court of public opinion which could be far more damaging than any fine.
Businesses should act now to ensure they don’t fall foul of the new rules.”