Oral Answers to Questions

Debate between Jim Shannon and Gareth Davies

Tuesday 19th December 2023 Commons Chamber

[Jim Shannon (Strangford) (DUP)]

The life sciences sector is worth £2.4 billion to the Northern Ireland economy. What steps have been taken, with counterparts in the Northern Ireland Assembly, to increase funding for employment within this worthy sector?

[The Exchequer Secretary to the Treasury (Gareth Davies)]

The hon. Gentleman is quite right that life sciences is one of the key growth industries for this country. I would be happy to meet him to discuss all the things we are doing for the sector, particularly in Northern Ireland.

Investment Industry Exposure to Modern Slavery

Debate between Jim Shannon and Gareth Davies

Tuesday 26th October 2021 Westminster Hall

[Gareth Davies (Grantham and Stamford) (Con)]

I beg to move,

That this House has considered investment industry exposure to modern slavery.

Modern slavery is one of the most prevalent and egregious violations of human rights in the world today.

It is great to see you in the chair, Mr Robertson, for what is my first ever Westminster Hall debate. Hopefully my performance will not mean that it is my last. I welcome the Minister to her new, important role. I know she will carry out her brief superbly in one of the most important jobs in Government—safeguarding our most vulnerable people.

I think we can all agree that the shameful existence of modern slavery has no place in a civilised world. It is an issue that should concern every person who believes in the integrity of common humanity, and should be a concern for every business, because it distorts markets and undermines ethical business practices. As an international community, we have rightly taken collective responsibility for defending human rights around the world. Organisations, such as the United Nations working group on contemporary slavery, have drawn increased attention to the issue and made significant strides in defining and identifying this covert and highly complex crime.

That being said, there is a great deal more work to do. Human exploitation continues to pervade every major nation on earth. Almost half the countries in the world have yet to criminalise slavery. In the UK alone, it is estimated that 136,000 people are currently victims of this awful crime. However, we are here today to specifically discuss the role that the investment industry can play in tackling modern slavery because, as it currently stands, financial services are not considered part of the solution in public policy. I want to do my little bit to try to change that.

We must first acknowledge the great work that this Government, and previous Conservative Governments, have done in tackling this issue, thanks to the leadership of my right hon. Friend the Member for Staffordshire Moorlands (Karen Bradley), together with, of course, our late friend and colleague James Brokenshire, the Security Minister at the time, who passed the Modern Slavery Act 2015. The vision for that legislation was truly world-leading, and the UK became the first country in the world to require businesses to identify and address modern slavery risks in their operations and supply chains. It is an Act that we, in this country, should be incredibly proud of, for it has highlighted that modern slavery exists in the private economy. It has also paved the way for legislation in other countries—in Australia, France and the Netherlands.

However, while we reflect on what the 2015 Act has achieved, we must also acknowledge the need for evolution. All legislation requires continual review to keep pace with developing risks, and the Government have therefore, rightly, announced that they plan to strengthen the Act in response to consultation in 2019.

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Gentleman on bringing this forward. I spoke to him outside, so he knows what my thoughts are. Does he not agree that it is important that for girls in particular, we need to understand that investment portfolios should show mindfulness on human slavery? It is not enough to say that if we do not use modern slavery in our businesses, our hands are clean. Would the hon. Member agree that we must be cognisant of how investment portfolios gain interest? This can only be done, as the hon. Gentleman says, through legislation and legislative change.

[Gareth Davies]

I am grateful to the hon. Gentleman for his intervention, which is a great honour. That is another first for me, so I feel like I am really making it now. I completely agree that young girls and young people—all people, actually—who have investments, savings or a retirement pot, need to know and have confidence that those who invest that money on their behalf are doing so prudently and are putting in place the checks to ensure that there is no inadvertent risk of modern slavery. The Government should do everything they can, as I will come on to in a minute.

The Government’s commitment to amend section 54(5) is intended to make it more prescriptive for investment funds. I completely agree with that, but even with those changes, that section would remain entirely focused on internal business structures and supply chains, not where their investments are made. The good news is that an increasing number of responsible companies are holding themselves to a higher standard. Many investors are already assessing modern slavery risks as part of their robust environmental, social and governance strategies or choosing to report their alignment with the United Nations’ guiding principles on business and human rights.

Yesterday, I met a group of investors, and this year alone, I have met 24 separate financial services companies in preparation for today’s debate. I found that they already have robust measures in place to tackle modern slavery. On the whole, however, the sector has not integrated modern slavery risks into investment processes to the same extent that it has adopted environmental risks. Some 795 financial organisations published modern slavery statements under the Act last year, but of 79 asset managers who submitted a statement, only 27% disclosed that they had conducted due diligence on modern slavery risks.

That is clearly a problem, but I believe that there are three solutions. First, the Government could broaden section 54 of the Act and consult on including a requirement that investment portfolios are included, as they are in Australia. Secondly, the Government could issue specific statutory guidance on how investors can assess modern slavery risks—again, as they do in Australia—so they are equipped with knowledge on that assessment. Thirdly, as it is a global problem that needs a global solution, we should work with our global allies to establish a taskforce, modelled on the taskforce on climate-related disclosures. Although the issue is different, the approach can be the same.

As it stands, financial services firms are a £9 trillion lever that we are not yet pulling in our fight against modern slavery. The UK is the largest net exporter of financial services in the world and the law change that I have proposed could make a difference in eradicating that horrendous crime. It would also protect and promote our democratic values at home and abroad. British savers and investors should never be used to support profit from human slavery. It matters for global Britain, as our leadership in this space will create prosperity at home and help to promote our values abroad. The situation that we walk past is the situation that we accept. It is an issue hidden in plain sight. We need to pull every lever we can to end it once and for all.