Conflict Mineral amp Ethical Sourcing Workshop 2015 Todays Presenter James Calder Director Compliance Programs Assent Compliance Over ten years as a senior expert on product stewardship ID: 677843
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Compliance Program for Anti-Human Trafficking
Conflict Mineral & Ethical Sourcing Workshop 2015Slide2
Today’s Presenter
James Calder
Director - Compliance Programs
Assent ComplianceOver ten years as a senior expert on product stewardship
, regulatory approvals/certifications, product safety, and ethical
sourcing.Slide3
Main Legislative Drivers
Federal
Acquisition Regulation (Executive Order 13627)
California Transparency in Supply Chains Act
UK Modern Slavery Act 2015Slide4
Federal Acquisition Regulation
Human Trafficking Provisions Timeline
A contract clause prohibiting severe forms of HT, procurement of commercial sex acts and the use of forced labor has appeared in federal service contracts
Contractors had to: i) notify employees about the policy; ii) establish an employee awareness program and iii) notify the Government of an alleged
violation
Expanded
to cover all federal contracts and subcontracts, including those for supplies and commercial items
Addition
of language to make the adoption of a
TiP
awareness program a mitigating factor if a violation
occurred
2006
2007
2009Slide5
Federal Acquisitions Regulation
(Executive Order 13627)
Expanded list of types of conduct
Prohibits the withholding of identity documentation Prohibits the use of misleading or fraudulent recruitment practices
Prohibits the charging of recruitment feesOutlines contractors responsibilities to provide return transportation
Outlines contractors responsibilities in providing employee housing that meets host country housing and safety standardsSlide6
Federal Acquisitions Regulation
(Executive Order 13627)
Recruiters
Must use trained recruiters abiding by local laws
Contracts
C
ontractors
to provide employment contracts –
if
they are separately required to do so by law or by contract - in writing, at least 5 days before
relocation in
a language understood by the employee and that contains details
about, work description, Wages, prohibition
on charging recruitment
fees, work
location(s), living accommodation and associated costs, time off, roundtrip transportation arrangements, grievance process and the content of applicable laws and regulations that prohibit trafficking in personsSlide7
Changes in reporting requirements
Contractors must report ‘credible information’ to both the contracting officer and the agency Inspector General
Contractors must cooperate with Government investigations of trafficking (this includes provision of information, access to facilities and staff, and responsibility to protect all employees suspected of being victims or witnesses to prohibited activities.
Federal Acquisitions Regulation
(Executive Order 13627)Slide8
Mandatory
components of the compliance plan:
(i) an
awareness program; (ii
) an employee reporting process; (iii) a recruiting and wage plan that addresses the restrictions on recruiting fees;
(iv)
a housing plan that ensures housing meets host country housing and safety standards; and
(v)
procedures to prevent trafficking activities by agents and
subcontractors
Compliance
as a mitigating factor
Compliance plan can only be considered as a mitigating factor for liability if:
Was in place at time of violation
Was implemented at time of violation
Company took remedial actions, including reparation to victims
Maybe a stupid question but can you explain the difference of “in place at the time…” compared to “implemented at time…”
Federal Acquisitions Regulation
(Executive Order 13627)Slide9
UK Modern Slavery Act
UK Modern Slavery Act
This
Act requires companies to produce a "slavery and human trafficking statement" each financial year, disclosing their efforts (or lack thereof) to ensure their supply chains are free from slavery and human trafficking.Required for all companies (private and public) doing business in the UK and having over £36 million (Global)Applies to good and services
Must report the business structure, policy, due diligence processes, areas of risk, KPIs, trainingWent into effect last monthSlide10
California Transparency in
Supply Chain Act
Since January 1, 2012, every retailer and manufacturer doing business in California with annual worldwide gross receipts exceeding $100 million must disclose on its website the extent to which it works to prevent AHT in the supply chain
.Disclosure to
include: Verification (Does it assess the Supply Chain
?)
Audit (Does
it perform
?)
Certification
(Do suppliers “certify
”?)
Internal
Accountability (Internal Procedures
?)
Training (Does it train and how?)Slide11
We, ACME Corp,
Do not verify our supply chain for human traffickingPerform no auditsDo not require suppliers to certify they supply goods free of human trafficking
Have no internal procedures to identify human traffickingDo not provide any education to our employees or supply chain on the risks of human trafficking
CA TISA StatementSlide12
We, ACMECARE Corp,
Have implemented a risk based assessment performed by a third party with human trafficking subject matter expertise. The assessment covers every known supplier and labor broker in ACMECARE’s supply chain. This occurs on a yearly basis for the entire supply chain with increased frequency for every supplier and/or labor broker holding some level of risk
Performs yearly unannounced third party audits within the entire supply chain. Selected auditors must demonstrate specific knowledge on the risks of human trafficking. Audits are always performed on high risk suppliers plus a random selection of 10% of our other supply chainRequires all direct suppliers to contractually certify they comply with the labor laws of the countries in which they do business. Local labor laws are identified by region for the suppliers knowledge and encouragement
Through its Ethics Committee, has implemented internal procedures to monitor the efficacy and results of our anti-human t
rafficking program. The Ethics Committee provides recommendations to the Compliance Officer who reports to the Board for their commitment on the entire organization’s anti-human trafficking program.
CA TISA StatementSlide13
Three Regulations: Single SolutionSlide14
To be successful, an Anti-Human Trafficking program should cover the following categories:
Building a ProgramSlide15
STEP 1: Policy
Creation
The Policy is your company’s framework detailing your approach to these regulations
Objective:
details the regulations impacting your companyPolicy Statement: demonstrates your position
Roles &
Responsibilities:
defines employees roles
Hotline:
provides reporting mechanism
Champion:
must be adopted and accepted by senior leadershipSlide16
STEP 2: Awareness Program
Broadcasting your company’s policy and requirements to address Anti-Human
Trafficking
Develop & Distribute Educational Materials: creates awareness for internal employees as well as suppliers to ensure they are monitoring activities
Communicate
Requirements:
inform the supply chain of the requirements and actions that constitute a violation of your policySlide17
A Reporting Hotline provides employees, suppliers and contractors a way to report issues, ask questions and provide assistance
Address Confidentiality: Explain the measures taken to ensure any information provided is done so in confidence
Provide Instructions: Reporting is only as good as the detail provided so its important instructions are given in order to demonstrate what’s needed for a company to take action
STEP 3: Reporting
HotlineSlide18
STEP 4: Supply
Chain Risk Assessment
Assessing your vulnerability to
human trafficking issues within your supply chain will help eliminate
riskCreate a Sourcing
Map:
certain geography locations pose a greater risk to the potential for Human Trafficking
Identify Supplier/Contractor
Practices:
through the use of questionnaires and audits document the hiring practices of your supply chain
Include your business operationsSlide19
STEP 5: Mitigation Activities
Exposure of any potential issues requires an action plan to change the practices of the supply chain or eliminate the
source
Questionnaire/Audit Review: evaluate supplier responses and work with them to eliminate hiring practices that create risk for Human Trafficking violations
Share Requirements
Annually:
pass along your supplier code of conduct and educate suppliers on the need for ethical practicesSlide20
STEP 6: Incident Management
Create a process by which your organization can properly assess and resolve any instances of human
trafficking
Manage incidents reported through hotline, HR, or other avenuesAssigns ownership (case management) to identify, analyze, and correct any exposure to human traffickingReporting of incidentsSlide21
STEP 7: Continuous
Improvement
Demonstrate your company’s continued efforts to improve supply chain transparency, promote education and awareness on the topic and reduce supplier risk
Year Over Year Improvement Opportunities:
as the program gets started document ways in which your company can improve its processes and communication within the supply baseIncreased Audit Verifications:
create a plan to add supply chain audits to your annual process
KPIs:
document your supplier risk and track your decrease in risk level as the program maturesSlide22
STEP 8: Due Diligence
The verification process by which a company ensures its program is robust, adopted by the supply chain, promotes transparency and meets the requirements of the relevant
regulations
Program Completeness – understand the reporting requirements, define execution
Transparency – ensure your internal processes are auditable and expectations to your suppliers are understood and able to be followedProcess Documentation – how your company and supply chain will handle situations as they arise
Has to include some validation/challenge to areas of risk
Applies to all stepsSlide23
Thank You!