Eradicating human rights abuses in corporate value chains: from description to prescription?

The rights of workers affected by the activities of Western companies have been in the spotlight recently, with consumers, investors and NGOs becoming more concerned about how companies treat those in their value chains who are most vulnerable to exploitation. This article examines the trend of legislators also turning their attention towards this area.

In the UK, the Government plans to increase the amount of information that companies must include in their modern slavery and human trafficking statements. 

In continental Europe, various measures have been introduced or are proposed at a national level that will require companies to conduct due diligence on their supply chains in order to identify and address potential human rights abuses. Similarly, EU legislators have proposed a new Directive on supply chain due diligence that would require most companies registered in a Member State or selling goods or providing services in the EU internal market to carry out effective due diligence to identify and address adverse impacts on human rights, the environment and the good governance of countries where they or their suppliers operate.

Overall, the legislative direction of travel is from disclosure – requiring companies to describe what they are doing to identify and address possible human rights abuses – towards mandatory obligations which prescribe the measures companies should take.