SMEs ‘unaware’ of Modern Slavery Act impact

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Small and medium sized businesses are unaware of the cascading impact the Modern Slavery Act has on them, the Chartered Institute of Procurement & Supply (CIPS) has said.

Research by the institute found that 61 per cent of SME’s surveyed were entirely unaware of the new legislation, which comes into force on 1st April.

The CIPS said that although the legislation targets businesses with a turnover of over £36million, it has been designed to have a ‘cascading effect’ on smaller companies to ensure their supply chains are also slavery-free. It said that ‘as larger businesses prepare their statements under the new rule, it seems that UK SMEs are shockingly unaware of this knock-on impact on them, and are unprepared to deal with forced and slave labour issues.’

“Ultimately, modern slavery is not an issue confined to the supply chains of large multinational corporations,” said David Noble, group CEO of the CIPS. “On the contrary, SMEs can often have long and complicated supply chains themselves.

“They are just as likely to find enslavement in their operations, right here in the UK, as recent cases show.”

But 67 per cent of SMEs surveyed admitted to having never taken any steps to tackle the issue of forced labour. 75 per cent said they would not know what to do if modern slavery was found in their supply chains.

The CIPS has said that that although 80 per cent of companies with turnovers of less than £36million said they were yet to discover slavery, this appears to be ‘a result of ignorance over prudence with very few businesses actively looking for slavery in their supply chains.’

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