Benchmarking Report Ranks Food & Beverage Companies on Forced Labor Risk Mitigation

Benchmarking Report Ranks Food & Beverage Companies on Forced Labor Risk Mitigation

The 2018 KnowTheChain Food and Beverage Benchmark Findings Report has been released, ranking Unilever, Kellogg and Coca-Cola at the top of the list of companies leading the way in tackling forced labor.

This is the second time KnowTheChain has evaluated the industry, with the first benchmarking report having been launched in 2016. The report evaluates 38 of the largest food and beverage companies in the world, assessing their disclosures and due diligence performance against seven benchmark themes:

  • Commitment and governance.
  • Traceability and risk assessment.
  • Purchasing practices.
  • Recruitment.
  • Worker voice.
  • Monitoring.
  • Remedy.

The report found that companies have improved practices to prevent forced labor in supply chains since 2016, but the average score remains low: only 30 out of a total 100 points.

Workers in this sector are vulnerable to exploitation. They are often isolated on remote farms and boats, and there is generally a lack of oversight into their working conditions. The results of the report highlight that more needs to be done to protect these workers.

In addition to analyzing company efforts, the benchmarking report puts forward standard policies companies have. The average company had in place:

  • A supplier code of conduct that incorporates international standards prohibiting forced labor.
  • A process for flowing the code of conduct further down the supply chain.
  • Employee training on forced labor.
  • A grievance mechanism accessible to suppliers’ workers and external stakeholders.
  • An audit process to assess suppliers for incidences of forced labor.

The leading companies weren’t necessarily the largest companies evaluated. Tesco (fourth place) and Kellogg (second place) both outranked significantly larger companies. Tesco was one of only three companies benchmarked that outlined steps taken to address allegations of forced labor in the supply chain. Kellogg discloses the company’s efforts to mitigate the risk of exploitation of migrant workers, and provides training to suppliers on ethical recruitment and migrant workers’ rights. The company also includes several recruitment agencies in their audits.

Based on the findings, KnowTheChain recommends that the average company provide training to suppliers on risks of forced labor, and work with recruitment agencies to ensure responsible recruiting practices to prevent debt bondage. Companies also need to empower workers to understand their rights, and provide evidence of a grievance mechanism that can be used by suppliers’ workers.

Furthermore, companies should include all commodities in the supply chain in their risk assessment and risk management efforts. To date, most companies have focused on reducing forced labor in the sourcing of palm oil, a commodity associated with a high risk of human rights abuses. Other high-risk commodities companies should focus on include wheat, beef, coffee, rice, sugar, tea and tomatoes.

KnowTheChain is supported by global investors, who represent more than $3 trillion in assets. These investors are committed to minimizing forced labor in their portfolios. Companies that have strong programs in place to address forced labor can protect workers in their supply chains while also gaining a competitive advantage, and minimizing the financial risks associated with non-compliance with existing modern slavery laws.

On October 17, Assent’s Kate Dunbar will join Felicitas Weber, Project Lead at KnowTheChain, to discuss the results of the report, and how companies can improve their efforts to address forced labor in their supply chains. Register here now.

To learn more about Assent’s Human Rights Module, and how it can support your forced labor and slavery risk mitigation and compliance efforts, email info@assentcompliance.com.

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