Commercial Organisations and Public Authorities Duty (Human Rights and Environment) Bill [HL]

Baroness Young of Hornsey Excerpts

2nd reading
Friday 10th May 2024 Lords Chamber

Moved by

[Baroness Young of Hornsey]

That the Bill be now read a second time.

[Baroness Young of Hornsey (CB)]

My Lords, I declare my relevant interests: I am a patron of Anti-Slavery International, one of the sponsors of the Bill, and an honorary associate professor at Rights Lab at the University of Nottingham, where I also hold the position of chancellor. I express my gratitude to colleagues in the House and outside the House, especially Sian Lea from Anti-Slavery International, all colleagues at the Corporate Justice Coalition, and those in the fashion industry and at GoodCorporation. Consultation with businesses has been at the forefront of thinking about the Bill.

In many respects I am disappointed to be standing here today with this Bill. I often think about those who fought for the legislation that would abolish the enslavement of and trade in Africans in the 19th century, and wonder which of them would have thought that, almost 200 years later, legislators would still need to develop laws seeking to eliminate the gross violations and abuses that we know far too many endure in supply chains across the world today. That abhorrent trade was accompanied on a grand scale by deforestation, with a medium-sized galleon taking around 4,000 trees to construct. We may like to distance ourselves from that history, but it has become increasingly clear that, despite the efforts of organisations such as Anti-Slavery International, and despite the impact of the Modern Slavery Act on transparency in supply chains, too many commercial and public entities do not feel obliged to identify and prevent human rights and environmental harms in their supply chains.

What has brought so many commercial bodies, NGOs and trade unions to the conclusion that we need such legislation? We are in an era of complex corporate structures, where businesses operate with hyperextended supply chains. This is combined with the UK’s current legislative shortcomings, in failing to hold companies accountable for their value chain impacts. This presents substantial obstacles for victims seeking justice. This Bill highlights a critical need for new legislation to ensure corporate accountability and to protect human rights and the environment.

Forced labour continues to be a widespread and persistent issue within the supply chains of UK companies, and indeed companies elsewhere, and public authorities. The roots of this can be found in weak governance, poverty, discrimination and so on—things with which I am sure we are all familiar. There is also the fact that business models are focused on producing low-priced goods, turned around very quickly, and that companies have extensive outsourcing and long, globalised supply chains. These factors also contribute to forced, abusive and exploitative labour, and environmental harms.

Added to that is the continued reliance on weak auditing and certification schemes, and attempts to block workers’ access to their rights, such as restrictions on unions. This has produced the current situation, whereby these abuses take place on an all too regular basis. We believe that a due diligence obligation must cover all internationally recognised human rights and environmental standards.

There are connections between the environment and human rights. Some people have questioned why we have put these two together in the Bill, although it has to be said that the majority of people, particularly in businesses, are supportive of that. To clear this up, connections between the environment and human rights have been increasingly recognised by Governments, courts, and international organisations and societies. This is demonstrated by the unique and disproportionate way in which climate change and other forms of environmental damage impact vulnerable and marginalised groups, including increasing their vulnerability to modern slavery.

The United Nations guiding principles on business and human rights were seen as the first global standard for preventing and addressing this. The legislation that we are proposing would put legal responsibility on businesses, including the financial sector, and public authorities to prevent human rights and environmental harms in their value chains, and to conduct human rights and environmental due diligence as part of that prevention activity. The legislation would also allow victims of corporate abuses to access justice before the UK courts. This is a step forward from the Modern Slavery Act, in line with some of the most forward-thinking laws that are being developed globally, to push for corporate accountability for actions which contravene fundamental human rights. These principles, outlining how companies should undertake human rights due diligence by identifying, assessing, preventing, mitigating and accounting in order to address the potential for negative human rights impacts across operations and in value chains, have been widely accepted by Governments. Indeed, we are signed up to those principles.

A key point of the due diligence framework is that businesses should be proactive—this is critical—in addressing potential and actual negative impacts, and think in terms of harms and risks to people, not just to their own companies. Given that so many states have signed up the framework, and given that this model of human rights and environmental due diligence has been widely adopted, why do we need to enshrine such principles in law? It is because those frameworks are voluntary. Unfortunately, it gives me no pleasure to say that too many companies, commercial and otherwise, do not feel obliged to conform to or follow those principles or to acknowledge that framework. To put it simply, the voluntary approach has not worked.

We knew at the time of the passage of the Modern Slavery Act that it was ground-breaking and a world-leading piece of legislation, and many of our major and most trusted commercial organisations led the drive for transparency and supply chains, as in Section 54 of the Act. But it is no longer the case that Section 54 is at the forefront of legislation. Perhaps most importantly, it has not been as effective as we would have hoped anyway. I will not go into the detail of its merits and shortcomings; that review has already been undertaken by a committee of noble Lords.

Currently, there are several due diligence laws. The EU has recently passed its corporate sustainability due diligence directive, and this Private Member’s Bill—COPAD, for short—builds on the EU laws and existing laws, such as the German supply chain law, the French duty of vigilance and the Norwegian transparency Act. There is also draft legislation being considered in Belgium, Austria, the Netherlands and South Korea.

I realise that no Government want to impose burdensome procedures on business, but to claim that this proposed legislation would be too onerous and cumbersome is to miss the point. The Bill has been proposed and supported by businesses—again, by some of our most trusted and successful commercial entities.

Much is packed into the Bill, but I want to make sure that other noble Lords have the chance to express their opinion and, indeed, perhaps to suggest where we might wish to rethink some of the clauses in the Bill. We are open to receiving amendments.

If we adopted COPAD, we would be more aligned in terms of trading with leading global counterparts and we would be able to ensure a level playing field for business. That is the term that frequently comes up with the businesses with which we have consulted—to make a level playing field for those businesses that want to do the right thing. Such legislation aligns very much with the trade statement commitments that we made in 2023.

I started with historical references—and I know that we like to distance ourselves from that particular period of our joint histories and articulate the abhorrence we feel at that trade. But if we want truly to make a distance between ourselves and what happened then, we have to take the opportunity to right the wrongs that are currently going on around the world and affect millions of people. I beg to move.

--- Later in debate ---

[Baroness Young of Hornsey (CB)]

My Lords, I thank all noble Lords who have spoken in this debate, particularly those who spoke in support of the Bill, which seems to be the majority. I shall draw attention to a few remarks that noble Lords made and then come back on some of the issues that the Minister raised in his final remarks.

The support from the noble Lord, Lord Browne, is very much welcomed. I appreciate and acknowledge that, in his view, it is a realistic endeavour. It strikes me that, whenever you want to bring in something progressive that aspires to make us better than we are now, there is always that pushback that says “Wait a minute. Hold on. It’s too complex. We can’t deal with this. We shouldn’t be so aspirational. It’s not going to work with this sector or that section”. I am not going to draw the obvious allusions to those that preceded this debate, but they continue. It is not just frustrating; it is incredibly annoying.

For example, to cut to some of the Minister’s remarks, when he talks about feeling frustrated about the delay in implementing the strengthening of the Modern Slavery Act, I am not trying to boast, but I introduced two Private Members’ Bills, one in 2017 and one in 2018. There has been an independent review of the Modern Slavery Act, which made a whole suite of recommendations. We were promised that Section 54 would be strengthened and that the list of suggested headings would become mandatory headings under which companies should report, and that was five years ago. Of course, we are frustrated and annoyed because nothing has happened. To say that is because there is not enough parliamentary time seems quite bizarre to me in terms of what we need to deal with in this House.

We may feel frustrated and annoyed, but meanwhile I am constantly reading reports that are sickening, distressing, depressing—whatever you would like to say—about numbers of suicides, women being forced, virtually, to have hysterectomies so that they do not have children or periods and can stand up and work all day, millions of children in child labour. And we are going to sit here and say that it is a bit complicated, it is a complex piece of legislation and there are flaws in it. Guess what? There are flaws in every piece of legislation that comes before this House and the other House, and we work through them if we have a will to do so. That is what strikes me.

Where is the real will to deal with these issues demonstrated? For how much longer are we going to go on saying that it is too much of a burden? Think of the burden on those families and on people who live in poverty, because they have no choice about the kind of employment they can seek and so are continually exploited so that we can wear cheap clothes, have nice cheap food and have a nice time as we swan around Westminster. It is just not acceptable.

On the Minister’s response, I am sorry if I am being rude or insulting, but I feel very strongly that we have had these kinds of proposals in the past, where people have sought to upgrade what we are doing, and we get the response: “Well, we can’t expect people to do this”. Actually, many SMEs have been consulted—I am quite happy to accept that it is a limited number—and have said that they want to do this.

Interestingly, when we did the consultation for the independent review of Section 54 of the Modern Slavery Act, it was businesses that were saying “Don’t have any threshold—£36 million is too high”. They wanted to acknowledge the fact that many of those sectors, particularly the fashion sector, are comprised of a huge number of SMEs. If you cut them out from the equation, you are not dealing with the problem. Of course, we are saying that these things should be proportionate and be determined by the Secretary of State, in consultation.

I had probably better finish here. I am very disappointed with the Government’s response. I am slightly encouraged by the Opposition’s response and happy to have any conversations—and to pass on contacts and networks, and so on—so that people can judge for themselves what is going on. I guess I ought to conclude now.

Bill read a second time and committed to Committee of the Whole House.