In 2015, the UK implemented groundbreaking legislation, the Modern Slavery Act (MSA) to force corporations to seriously address the risks of child and other forced labor in their supply chains. Businesses all over the world adjusted their ethics and compliance programs to comply with the MSA.
They analyzed supply chain risks, developed policies, created operational guidance, and began to craft disclosure statements about their efforts to prevent forced labor.
The legislation does not apply to international organizations, but what if it did? Most of us assume that international organizations with laudable humanitarian missions are behaving ethically. The reality is that many of the largest and most respected aid organizations have ethical blind spots within their operations. Like businesses, they can control billions of dollars. Like businesses, they make efforts to cut the costs of goods. Like businesses, they have complex supply chains in high risk areas.
Unlike businesses, however, they do not face legal or regulatory consequences that could drive change. In international aid, many organizations operate with increasingly controversial privileges and immunities that shield them from lawsuits. The moral hazard is clear, and it leads to disturbing results.
Take the “blood brick” scandal, for example. In 2015, DFID, the UK’s Department for International Development, was put on the defensive by a Guardian report. The article chronicled how UK taxpayer dollars, funneled through the World Food Program, funded child and forced labor in dangerous conditions in Nepal.
The piece suggested that “international donors, aid agencies, multinational companies and the Nepalese government [were] systematically failing to ensure that there [were] effective policies in place to keep their supply chains free from child and bonded labor.”
DFID responded by saying, “We expect all the partners we work with to carry out rigorous due diligence and ongoing project monitoring and supplier checks.” It is not at all clear, though, that DFID ever articulated their standards or checked to see what controls were in place in the organizations they fund. And no one thinks it is enough if a business merely declares that they “expect” their partners have basic human rights policies and safeguards.
Before donors write their next check to any international organization, they need to demand a publicly available slavery and trafficking statement described in Article 54 of the MSA. The statement should detail following:
- organization structure, including supply chain operations
- high risk parts of the business
- policies in relation to slavery and human trafficking
- third party due diligence processes
- training for staff and contractors on risks
Most importantly, donors should require that the board and the senior executives of the organization sign off on the statement. Leaders need to be held accountable.
If the UK is serious about eradicating the scourge of child and slave labor, that commitment should filter into its aid budget. Otherwise, the government may inadvertently be funding the very practices they are trying to stop.
Ashley Jackson, pictured above, is the founder of Aid Ethics, which works to raise awareness of social and environmental risks in the operations of international organizations. She has a JD from the Seton Hall University School of Law and a BA in International Relations, Chinese, and Asia Studies from the University of Colorado. She can be contacted here.