A groundbreaking report into the UK’s financial sector has found worryingly low levels of awareness of forced labour and exploitation of workers.
The study, led by Dame Sara Thornton, the UK Independent Anti-Slavery Commissioner, suggests nearly half of bankers and other finance staff don’t know about the nature and scale of the problem – nor how their business is involved in the abuse.
The report, carried out in partnership with Themis and the TRIBE Freedom Foundation, shows how finance is at the heart of labour exploitation – a multi-million-pound industry – and calls on leaders to take a stand against it.
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It’s estimated that 130,000 people are connected to slavery and exploitation in the UK – but the study found:
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45% of senior managers are unaware that modern slavery exists in the UK
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30% of financial services employees do not believe modern slavery is something that happens in the UK.
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36% of financial industry employees think that their organisation has no influence at all in combating the issue
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68% of financial industry employees surveyed did not believe the subject had been raised more than “a few times” by senior management, if at all, in the last 12 months.
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Many companies see the publishing of a modern slavery statement as nothing but a tick box exercise
Dame Sara Thornton, UK Independent Anti-Slavery Commissioner, said: “I have written to the CEOs of major financial institutions asking them to respond to the worrying findings that this report highlights and let me know what they are going to do to address modern slavery and human trafficking within their organisations.”
The financial services industry has a major role to play in combating forced labour and modern slavery, which generates $150 billion in profits every year.
Across the UK and globally millions of people are exploited in the workplace, on farms, in factories, or as cleaners.
Whether a criminal gang is laundering money through a high street bank or sophisticated criminals are transferring money internationally, whether your pension is investing in a company that uses bonded labour or your savings are invested in abusive garment factories, money is the driving force behind every case of exploitation.
Five years ago, the Modern Slavery Act 2015 came into force – but this study found that the legislation has had a limited impact on protecting the lives of those vulnerable to exploitation.
In reality, many financial institutions appear to treat it as a tick box exercise, doing only the minimum required by law, and many not even complying with the act at all.
Too many financial institutions that publish a modern slavery statement focus only on the direct impacts of their business such as cleaning or catering staff, or construction of office buildings, without acknowledging the far larger impact their business has through its investment, lending and client relationships.
For example, assets under management (AUM) at the world’s 500 largest asset managers exceeded $100trn (£76.8trn) for the first- time last year. This new study asks: what are those assets, and are they linked to exploitation and labour abuse?
The study polled 1001 professionals from the financial services industry.
Key recommendations:
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Leaders should set the tone at the top by taking a stand against abusive practices in their supply chains and business activities
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Banks and financial services companies should undertake regular due diligence to check for abusive practices is their supply chains and investments
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Banks and financial services companies should integrate modern slavery red flags into their existing money laundering control frameworks
Dickon Johnstone, CEO of Themis, says, “financial institutions need to take a good look at their core business activities, and understand where their money is going and what types of business it is enabling. I challenge any senior manager who says their organisation has no links to modern slavery to prove it. There are 40 million people in slavery in the world, so chances are your institution will have either direct or indirect links to modern slavery and human trafficking somewhere within your operations, your supply chains or in those businesses you lend to or invest in. Don’t turn a blind eye – do something about it.”
Tom Stancliffe maintains, “I am convinced that the only way we will make a step change is if business leaders set the tone from the top and commit to eradicating all forms of coercive labour practices.”
