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Bridging the buyer-supplier gap to root out forced labor in supply chains

  • Apparel
  • ,
  • Supply Chain Management
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    Global supply chains are a major perpetrator of modern slavery. With over 16 million victims in the private sector, business involvement is key to sustainable, systems change that eliminates forced labor. In the apparel sector, a lack of transparency between buyers, suppliers, and manufacturers is what often allows modern slavery to go unnoticed.

    International apparel brands, particularly those in the ready-made garment (RMG) or “fast fashion” sector, monitor their legally registered Tier 1 suppliers in India. Due to the low pricing and quick turnaround production pressures of the industry, Tier 1 suppliers often sub-contract to unauthorized and unregistered factories that are hidden from brands in order to meet demand. This creates a lack of transparency between buyers (brands) and suppliers, leading to poor monitoring of deeper supply chain operations and allowing forced and child labor to thrive.

    To enhance monitoring and make supply chains more visible to buyers, GFEMS and ELEVATE, a business risk and sustainability solutions provider, are creating innovative apparel brand monitoring and remediation systems in India.

    ELEVATE has built and tested a predictive analytics tool to detect risks of unauthorized sub-contracting and forced labor practices. The tool uses institutional knowledge, third-party data supply chain data, and new procurement audit data to identify which Tier 1 suppliers are at high risk of using unauthorized contracting to meet their production orders.  Along with identifying high-risk suppliers, ELEVATE has also developed remediation processes for brands, Tier 1 suppliers, and informal/unauthorized factories to collaborate to improve labor practices, ensuring that factories are incentivized to participate and remain transparent.

    Despite a slowdown in the apparel industry during the COVID-19 pandemic, ELEVATE has already generated significant brand interest in hosting social compliance audits. To date, the project has:

    • Established partnerships with four key global brands
    • Completed 22 on-site assessments
    • Generated 13 supplier reports on risk of unauthorized sub-contracting.

    Five monitored suppliers have indicated varying levels of extreme to medium risk of unauthorized sub-contracting. Two of those suppliers have agreed to deliver a remediation plan, including onsite capacity building with suppliers.

    By offering both modern slavery risk identification and effective remediation plans for suppliers who are at risk, the tools developed in this project both allows buyers to make smarter decisions about their suppliers, and provides suppliers with plans to improve their practices and continue operating. Both are essential for generating and maintaining systems level change that eliminates forced labor from supply chains.

    This project was funded through a grant made by the U.K Foreign, Commonwealth, and Development Office (FCDO). Any opinions in this article do not reflect the opinions of FCDO.

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