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June 12, 2014
House Bill Calls for Corporate Disclosure of Human Trafficking Risks
    by Robert Kropp

Investors issue statement in support of bill introduced this week that will require companies to disclose policies addressing human trafficking in their supply chains.


Last month, the US House of Representatives overwhelmingly passed five bills seeking to curb some of the worst abuses associated with human trafficking. For the most part the bills focused on domestic child sex trafficking, mandating that victims of the practice receive social services instead of being prosecuted.

A bill introduced into the House this week seeks "to require certain companies to disclose information describing any measures the company has taken to identify and address conditions of forced labor, slavery, human trafficking, and the worst forms of child labor within the company's supply chains." Introduced by Representatives Carolyn Maloney and Chris Smith, the proposed bill focuses on two legal foundations of corporate social responsibility (CSR).

A provision in the Dodd-Frank Act calls for corporate oversight of supply chains to ensure that human trafficking abuses are not taking place. And the Guiding Principles on Business and Human Rights, published in 2011, asserts a corporate responsibility to respect human rights and to address adverse impacts.

Enacted in 2012, the California Transparency in Supply Chains Act requires companies with revenues of more than $100 million doing business in the state to publish on their websites their policies addressing slavery and human trafficking in their supply chains. The bill introduced this week would, according to the Interfaith Center on Corporate Responsibility (ICCR), "apply to all publicly traded or private entities in every sector and, consequently, would have broad international impact."

ICCR, along with Christian Brothers Investment Services (CBIS) and Calvert Investments, issued a statement welcoming the bill, stating "that companies with formal human rights due diligence processes are better positioned to safeguard against these adverse human rights impacts and hence, better able to protect shareholder value."

In 2011, ICCR published a Human Trafficking Investor Statement, which noted that many of its members “have been pressing businesses to scrutinize their supply chains and operations to ensure that they are not inadvertently complicit in human rights violations, specifically, violations associated with human trafficking and modern day slavery, including child labor, forced labor and slave labor.”

And CBIS has been particularly active in engaging with companies in the hospitality industries to ensure that the issue of human trafficking at major sporting events will be addressed.

In the statement published this week, the investors said, "Proactively addressing these risks can guard against the negative publicity, business interruptions, potential lawsuits, public protests, and reputational damage that may result from undetected human rights violations."

"The intractability and pervasiveness of trafficking and slavery require strong legislation that moves beyond voluntary disclosures and levels the playing field for all companies," the investors stated.

 

 
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