Proving the Absence of Forced Labor in Supply Chains

By Adrian Gonzalez

In my recent Talking Logistics conversation with Daniel Smith, Director of Sustainability and ESG at e2open, he talked about the Uyghur Forced Labor Prevention Act (UFLPA) and how “under the UFLPA, due diligence means you have to prove the absence of any forced labor touching any aspect of your product. Due diligence isn’t reasonable care, it’s proof positive now…but how do you prove the absence of something?”

I recalled Daniel’s comment when I read an article last week by Katherine Masters in Reuters titled, “Exclusive: US Customs finds garments made with banned Chinese cotton.” Here are some excerpts:

Roughly 27% of tests performed on shoes and garments collected by U.S. Customs and Border Protection in May showed links to cotton from China’s Xinjiang region, which has been banned because of concerns over forced labor, according to documents obtained by Reuters under the Freedom of Information Act.

To help enforce the law, customs officials have turned to isotopic testing, which can link cotton to specific geographic areas by analyzing the concentration of stable elements like carbon and hydrogen present in both the crop and the environment in which it has been grown, experts say…Descriptions of the items [with links to cotton from China’s Xinjiang region] detail a range of apparel, from boxers, jeans and tee-shirts to baby onesies and dresses.

To answer Daniel’s question, it seems like isotopic testing is one way to prove the absence of cotton from China’s Xinjiang region, and according to the article, “many retailers have also turned to isotopic testing in a bid to keep their supply chain free of cotton with links to forced labor.”

But considering the complexities of apparel supply chains — that is, the many steps and parties involved from raw materials to finished products — isotopic testing is not foolproof.

“Officials said isotopic testing alone is not enough to clear shipments detained at U.S. ports for suspected links to Xinjiang,” writes Masters. “More retailers and manufacturers are ‘spot checking’ materials from yarns to finished fabrics at various points in their supply chains using the analysis. Still, there is no guarantee those same materials were used in the finished products being investigated, according to [Eric Choy, executive director for trade remedy and law enforcement at U.S. Customs].”

Simply put, when it comes to ensuring compliance with the Uyghur Forced Labor Prevention Act and other regulations focused on forced labor and human rights abuses, it’s a very difficult and complicated task. As I highlighted a couple of years ago in “Screening Suppliers For Human Rights & Environmental Abuses,” 38% of the Indago supply chain executives we surveyed in March 2021 said that it would be “Very/Extremely Difficult” to comply with such regulations.

That is likely part of the reason why “business efforts to tackle modern day slavery are stalling,” according to an analysis of UK Government data by The Chartered Institute of Procurement & Supply (CIPS). Here are some details from the April 2023 press release:

Section 54 of the UK’s Modern Slavery Act 2015 requires in-scope organizations, those with a turnover of more than £36 million a year, to publish an annual statement outlining the steps they are taking to address slavery in supply chains. They are also ‘strongly encouraged’ to submit their statements to the Home Office’s modern slavery statement registry, which was established in March 20211.

But analysis of the registry by CIPS reveals that 29% of organizations falling within scope of the Modern Slavery Act have yet to submit their slavery statements to the 2022 registry [and almost a quarter of statements submitted lacked basic information about the steps being taken to tackle modern day slavery, with 23% failing to outline any measurable goals.]

What’s particularly interesting is that “more than a third (35%) of organizations perceived the United Kingdom as a region within their supply chain where risks of modern slavery abuses are most likely to occur [emphasis mine], followed by China (18%) and India (9%). Almost two-fifths (39%) identified migrant workers as the group most likely to be at risk in these locations. This was followed by refugees (19%) and children and women (both 15%).”

“Organizations are facing enormous pressures across their supply chains and, in these circumstances, it might be tempting to turn a blind eye to modern slavery and prioritize other challenges,” commented David Taylor, Chief Operating Officer at The Chartered Institute of Procurement & Supply (CIPS). “But it is precisely during times of economic hardship that we must be vigilant and keep up our efforts to tackle this issue.”

Is eliminating forced labor from your supply chain a priority? What steps are you taking to address this problem? Post a comment and share your perspective.