Did a Slave Make My Dress, Mom?

Record Levels of Global Slavery in Modern Times Remain in Place

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It might be hard for some to believe, but slavery practices are widespread and pervasive in the world today.  By some measures, this represents all time record levels of global slavery.  How is this possible in our modern times?  Surely we banned slavery long ago?

Sadly the facts suggest otherwise, and even the Secretary of State has taken notice.

Take Malaysia for example.  This report by leading social auditing firm Veri, featured in the NY Times during the Fall of 2014 demonstrated clear evidence of widespread forced labor in Malaysia within electronics manufacturing.

This report goes on to state that:

"You might think about debt bondage in relation to making bricks in South Asia or building skyscrapers in the Middle East, not putting together the pieces of your newest mobile phone or laser printer in Malaysia. But if you are reading this on a tablet, smartphone or computer monitor, then you may be holding a product of forced labor. Verité’s two-year study of labor conditions in electronics manufacturing in Malaysia found that one in three foreign workers surveyed in Malaysian electronics was in a condition of forced labor. Because many of the most recognizable brands source components of their products from Malaysia, this means that virtually every device on the market today may have come in contact with modern-day slavery.

Verité interviewed more than 500 male and female workers across all major producing regions, electronics products, and foreign worker nationalities.

Malaysian nationals were also surveyed. The results of these extensive interviews indicate that forced labor is present in the Malaysian electronics industry in more than just isolated cases, and that the problem is indeed widespread.

“Verité’s study is the most comprehensive look at forced labor in the Malaysian electronics sector to date,” Dan Viederman, CEO of Verité, remarked.

“Our report provides a clear sense of the scope of the problem in the industry, as well as the root causes underlying this egregious form of abuse, which center on unlawful and unethical recruitment practices.”

The report identifies the top factors responsible for making this sector prone to human rights abuses. According to Verité’s study, the widespread reliance on third-party agents for the recruitment, management and employment of foreign workers limits their protections and blurs accountability for labor conditions. Other top factors identified by the research as contributors to forced labor include unlawful passport retention, high and hidden recruitment fees resulting in widespread indebtedness that can trap workers in their jobs, deceptive recruitment practices, highly constrained freedom of movement, poor living conditions, fines and other penalties that prevent workers from being able to resign, and inadequate legal protections."

This of course represents just one country.  Bangladesh also has a recent history filled with insufficient and ragtag factory conditions leading to thousands of unnecessary and tragic injuries and deaths.

In Qatar, labor abuse has been well documented in FIFA's buildup to the 2022 Soccer World Cup, leading to thousands of worker deaths.

The most common practice involves getting individuals from poor families to agree to work in another country for a fee under false pretenses and on arrival, confiscate their passport.  The fee they paid was in effect a loan for which the annual net proceeds of their ongoing work is made typically impossible to ever fully pay off, making this a form of modern day indentured slavery.  

This report suggests 21 million people exist in this perpetual nightmare today, with the largest percentage in Asia.

How can you know whether your clothes or mobile phone were made by a slave?

You cannot know, but at the end of the day there are companies that try to avoid this, and those that don't. 

Apple, while being criticized at times for what happens in their supply chain is actually one of the better companies at this as a read of their 2014 Supplier Responsibility Report should demonstrate, but there's always more any such company can do.

Minimum standards on working conditions is one fundamental place to start.  If you are a Sustainable Investor, you need to know which companies you are investing in have such minimum standards and further, are verifying and enforcing those standards and conditions.  

Companies such as Nike have taken a reputation hit in the past for being seen as exploiting workers, and they have responded by trying to become an environmental and social leader. Best to get ahead of that curve proactively one would think whether you are a company or one of its shareholders.

Consumers also can show they care by insisting in these minimum conditions in supply chains of everything they buy.  Not caring has its repercussions.

Further setting an example on this is none other than Secretary of State John Kerry, who in early 2015 gathered representatives of the electronics, textile and retail industries around the following announcement.

With the State Department now putting a focus on labor conditions, it is up to companies to develop a plan and ensure there aren't abuses hiding in their supply chains.  Companies in industries such as Palm Oil are also starting to ratchet up their commitments as well.  The power of dollars, measurement and strategy can ensure that the days of indentured slavery come to an end.  Not caring has its repercussions, but caring combined with good planning can lead to better results for shareholders and global society, on this issue and others that span the environmental and social spectrum.