Every country and every business can be in some way susceptible to slavery. In the UK alone, victims have been found working in nail bars, at car washes, on farms supplying food to supermarkets and in factories producing mattresses.

Slavery is not just a social crime but a financial crime too. Perpetrators of modern slavery and human trafficking offences are often organised criminal gangs involved in benefit fraud, tax fraud and money laundering. This abuse of public funds impacts us all and businesses that benefit from exploiting workers have an unfair advantage over companies that operate legally and follow the rules.

Ramping up action

The Modern Slavery Act 2015 requires some organisations to publish Modern Slavery Statements, but the emerging evidence reveals this is having only a limited impact. Specifically, a recent joint report from the UK’s Independent Anti-Slavery Commissioner and others found ‘worryingly low levels’ of awareness in the UK’s financial sector – with nearly half of finance staff failing to understand the nature and scale of the problem and many companies viewing the required statements as merely a ‘tick-box exercise’.

Of course, the pandemic has inflicted unprecedented pressures on businesses and supply chains – and with that, livelihoods. Campaigners have warned that such desperation may in some cases lead to a more ‘laissez faire’ approach to regulation.

Just last week, the parliamentary Business, Energy and Industrial Strategy Committee published a report which concluded that many UK companies were displaying ‘wilful blindness’ to the potential use of slave labour in their supply chains and were ‘complicit’ in such activities.

Reassuringly, the UK Government has indicated that it intends to strengthen the law and other countries are starting to follow suit.

The role of chartered accountants

While members are not expected to track down often-hidden victims, we can use our knowledge and expertise to spot the ‘red flags’. For example, if a business’s output is disproportionate to staffing levels, this may suggest there are hidden workers; or if several workers have their wages paid into the same bank account, those workers may not be receiving what they are due.

ICAEW members are uniquely placed to identify such anomalies and should report these to the National Crime Agency, as they would have suspicions of money laundering.

Members can also review supply chains within their own business or that of their clients, regardless of whether they are legally obliged to produce a Modern Slavery Statement.

ICAEW

ICAEW is committed to ensuring that there is no modern slavery or human trafficking in any part of our institute or supply chains. We recently published our Modern Slavery Statement for 2021 and have undertaken to improve our staff training and to work with our suppliers to make sure they understand our commitment.

We have also developed an online hub, containing a wealth of resources including articles, guidance, webinars and useful links to help you and your business build your vigilance.

Further resources

• ICAEW’s Modern Slavery Statement for 2021
• ICAEW’s Modern Slavery online hub
• The Modern Slavery Act 2015
• Business, Energy and Industrial Strategy Committee report on forced labour in the UK
• Joint report on modern slavery and financial services