Good Supplier Ethics Creates Resiliency: Report

While good ethics within trading and sourcing is not only the right thing to do in a moral sense, new research shows it drives resiliency. This is especially true for the fashion industry.

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After years of outsourcing parts of the supply chain farther and farther away from company's country of origin, the supply chain is currently swinging back around and looking to re-shore, near-shore and have greater visibility into sourcing in general. While it is hard to believe for many and is often hidden by lengthy supply chain, modern slavery does indeed exist. Without visibility into sourcing some business may not realize they are buying from these very sources built on unethical practices. While ensuring ethical practices in sourcing and procurement is certainly the moral thing to do, it is also the right thing to do for resiliency, according to new research from Modern Slavery PEC. While so much sourcing comes from regions in India today, the report found that fashion supply chains in India that focused on sourcing ethics were much more resilient to the pandemic and what came after. Additionally, those with stronger relationships with sources faired much better as well. 

Per Modern Slavery PEC

  • The study followed a five-step methodology to gather data and to conduct analysis to understand the impact of Covid-19 on the management of modern slavery. The methodology and analysis was underpinned by baseline pre-Covid-19 data gathered in 2017/19 across Indian fashion supply chains.
  • Those brands who felt they positively engaged with the transparency in supply chains provisions in the UK Modern Slavery Act 2015, and their responsibilities towards their suppliers, tended to understand the impacts of the pandemic better, and were therefore better able to mitigate those impacts.
  • Business should capitalize on new technologies to strengthen worker voice to complement audit practices. The pandemic spurred innovation in how to connect with workers while traditional in-person audits were difficult to carry out. There are encouraging reports that the use of new technologies improves connections with workers, but more work is needed to understand the extent to which these approaches can replace face-to face activities.