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8 Sep 2020

Peter Hugh Smith, Room 151

Modern slavery in supply chains haunts our investments

For the migrant workers in the Gulf region, when their contracts were cancelled and their employers let them go, they were left with steep debts and no way to repay. Given CCLA’s ongoing work around addressing modern slavery, we were approached by human rights defenders and felt it our moral responsibility to act.

We spearheaded an investor collaboration to write to multinational companies with operations in the Gulf region to enquire about their recruitment practices and the welfare of their migrant workers...

We are starting to get responses which typically acknowledge that there are policies in place which forbid the payment of recruitment fees. While this is laudable, it does not really get to the root of the issue, which is that the payment of recruitment fees happens in another country and often a number of steps removed from the company itself. It is often hidden from the companies and we feel that these companies need to do more to uncover it. They need to interview their migrant workers, understand whether recruitment fees have been paid and reimburse these workers...

we as investors also need to do more. Within local government, modern slavery is often considered by those with roles in procurement or social care, however, we believe that it is also an important factor to consider when investing in funds. Investors have an important role to play in asking questions of their investment managers and urging them to ask investee companies to dig deeper and seek to uncover potential issues.