Supply chain ethics in developing countries can sometimes struggle to meet our expectations in the Western world, and conditions of modern day slavery are unfortunately a relatively common phenomenon across much of Asia. Just how hard is global sourcing within an ethical supply chain?
Supply chain ethics in developing countries can sometimes struggle to meet our expectations in the Western world, and conditions of modern day slavery are unfortunately a relatively common phenomenon across much of Asia. Just how hard is global sourcing within an ethical supply chain?
Thailand is wealthy neighbour to Cambodia, Myanmar and Laos, and up to 10% of Thailand’s workforce is thought to consist of migrant labourers. However, many end up working without official permits, unable to form unions or claim the legal minimum wage. As a result, as many as half a million people are currently living in conditions of slavery in Thailand, and during recent months this has been attracting significant international attention.
Cheap has a high price
Thai courts recently dismissed a criminal defamation case brought against British labour activist Andy Hall, for his contributions to a report for ethical watchdog Finnwatch which condemned abusive labour conditions in the Thai food industry.
The case was brought to court by Natural Fruit, a Thai pineapple company named by Hall in the report,Cheap Has a High Price. Defamation is a criminal offence in Thailand, and the company denied Hall’s allegations of long factory shifts, pay below the legal minimum wage and the illegal confiscation of migrant workers’ passports. The case was recently dismissed, but Hall still faces multiple other charges, and it’s unclear how Thai authorities will deal with the report’s allegations.
Ethical sourcing suffers in Thailand
In June, Thailand was downgraded to tier 3 in the US 2014 Trafficking in Persons report, placing the country in parallel with North Korea and Iran in terms of ethical behaviour. Thailand’s fishing industry was also exposed by the Guardian as a major culprit of modern day slavery earlier this year. It’s safe to say that the country’s supply chain ethics have come under fire in 2014 – but how can conditions be improved?
Natural Fruit may have got more than they bargained for bringing the case to court, with Hall’s court hearings uncovering multiple worker testimonies of child labour abuses and illegally low wages. The court case also fostered dismay in the “complicit cover-up” by the government, who placed blame on Hall rather than Natural Fruit.
However, this isn’t the first instance of modern day slavery reaching Thai courts. Only last year, media sources accused Thai navy personnel of complying with human trafficking activities, and the navy filed defamation charges against the Thai journalists involved in response.
Achieving an ethical supply chain in the UK
Finnwatch’s report examines responsibility issues relating to international private label products - items produced by an external supplier but sold under the retail company’s own brand. European private brand labels can be on average 30% cheaper than similar brand products, but the constant search for low prices and weakened position of suppliers can also lead to a sacrifice in sustainability and supply chain ethics, especially in labour-intensive sectors such as the food industry.
The research also revealed major failings by Western retail brands, whose corporate responsibility practices proved inadequate. In order to maintain an ethical and transparent supply chain, retailers must have visibility and control over every single manufacturer, supplier and subcontractor.
Supply chain management technologies can provide retailers with a framework through which they can control and monitor all production and sourcing processes. Segura monitors and controls the ordering of items through a pre-approved database of suppliers, which prevents rogue suppliers and subcontractors from entering a brand’s supply chain and risking their ethical reputation.
