HUMAN TRAFFICKING AND SUPPLY CHAINS Recommendations to Reduce Human Trafficking in Local and Global Supply Chains Sutapa Basu, Ph.D Johnna E. White, MPA University Of Washington Women’s Center This report was made possible through support provided by the Washington State Department of Commerce, as required by Washington Law 2015 3rd special session c. 4 s. 36 (ESSB 6052) The University of Washington Women’s Center The mission of the Women’s Center is to create a more inclusive and compassionate society by promoting gender equity and social justice through educational programs and services that allow all participants to succeed in life. JUNE 2017 REPORT TO LEGISLATURE ii Sutapa Basu Ph.D and Johnna White MPA – University of Washington Women’s Center CONTENTS Executive Summary ............................................................................................................................. 1 Introduction ......................................................................................................................................... 3 Definitions ............................................................................................................................................ 3 Globalization and Labor Trafficking.................................................................................................. 5 Foreign Labor Recruiters and Human Trafficking .......................................................................... 6 Governments and Labor Trafficking ................................................................................................. 8 Scope of the Issue: Statistics on Labor Trafficking ...................................................................... 12 Labor Trafficking and Washington State ....................................................................................... 15 Corporate Social Responsibility and Labor Trafficking ............................................................... 18 Methodology ..................................................................................................................................... 21 Topics Under Study .......................................................................................................................... 23 Shared Value through Supply Chain Management Practices ................................................ 23 Scope of Social Media Industry ............................................................................................... 30 Rana Plaza .................................................................................................................................. 30 The Bangladesh Accord ........................................................................................................... 33 Walmart ...................................................................................................................................... 33 Corporate and Public Leadership: Case studies and best practices in ethical sourcing ... 35 Costco & the Thai Seafood Industry ...................................................................................... 35 Costco’s Sustainability Commitment ..................................................................................... 35 Starbucks Coffee and Farmer Equity (C.A.F.É.) Practices Program.................................... 36 Sustainability at Hewlett-Packard........................................................................................... 38 Apple Supplier Responsibility Program ................................................................................. 39 Alta Gracia .................................................................................................................................. 40 Patagonia Corporate Responsibility ...................................................................................... 42 The Federal Acquisitions Regulation (FAR) Subpart 22.17—Combating Trafficking in Persons ....................................................................................................................................... 43 Coalition of Immokalee Workers (CIW).................................................................................. 45 The California Transparency in Supply Chains Act (The Act) .............................................. 47 iii Sutapa Basu Ph.D and Johnna White MPA – University of Washington Women’s Center California Client Employer Law ............................................................................................... 49 University Licenses & the Worker Rights Consortium......................................................... 51 Dell and Swedish County Councils Case Study .................................................................... 52 Madison Sweatfree Purchasing Policy and Cooperative Contract .................................... 54 San Francisco and Los Angeles Sweatfree Procurement.................................................... 56 Procurement Status Quo in Washington .............................................................................. 57 City of Seattle Sweatfree Procurement ................................................................................. 59 City of Olympia Sweatfree Purchasing Resolution .............................................................. 59 RECOMMENDATIONS: HOW TO EVALUATE AND MONITOR SUPPLY CHAIN PRACTICES WITHOUT BIAS .............................................................................................................................. 62 RECOMMENDATIONS: HOW TO DESIGN COMPREHENSIVE, PRAGMATIC, AND ENFORCEABLE LEGISLATION ON GLOBAL ETHICAL SOURCING PRACTICES ....................... 66 CONCLUSION ................................................................................................................................ 71 Appendix A: Additional Recommended Provisions To Include In An Anti-Human Trafficking Procurement Policy .................................................................................................. 72 Appendix B: Additional Recommended Provisions To Include In Legislation Encouraging Corporations Transparently And Diligently Manage Clean Supply Chains .......................... 74 Appendix C: Sweatfree Procurement Policies And Resolutions Adopted In The United States .............................................................................................................................................. 75 Gratitude and Acknowledgements ............................................................................................ 77 Works Cited ................................................................................................................................... 86 iv Sutapa Basu Ph.D and Johnna White MPA – University of Washington Women’s Center Executive Summary The trafficking of persons is a growing human rights problem that affects individuals locally and globally and is exacerbated by public and private supply chains. Outsourcing goods and services to countries with lower labor standards than in the U.S. has traditionally been one of the ways companies decrease production costs.1 However, this leaves many businesses, particularly those with global supply chains, at risk of contributing to forced labor practices abroad. In addition, we have found that human trafficking is present in Washington’s local supply chains and has been reported in eighteen counties within numerous industries.2 Washington’s commercial landscape offers opportunities for exploitation in sectors that are both predisposed to human trafficking and contribute to the local economy including construction, manufacturing, agriculture, hospitality and food,3 all of which collectively generate nearly $100 billion towards the state’s GDP. To gather assessments from individuals and organizations on how to reduce labor trafficking, researchers interviewed legal, non-profit service providers and academic experts, inquiring about nuanced supply chain practices and their perspectives on ethical sourcing successes (smart practices) and challenges, monitoring, and pragmatic policy development. KEY FINDINGS Many corporations, including Washington-based companies such as Costco and Starbucks, have strong Corporate Social Responsibility (CSR) initiatives that draw attention to their global footprint and aim to reduce instances of labor trafficking. Additionally, social media has proven to be a powerful tool in pressuring corporations to do more to eliminate labor trafficking and similar abuses from their supply chains (also referred to as ethical sourcing). However, these market drivers have not been strong enough to thwart the use of forced labor in product manufacturing, as demonstrated by the numerous cases of labor trafficking in the Information, Communications, and Technology (ICT) industry in Malaysia and China, the fishing industry in Thailand, and the garment industry in Bangladesh, to name a few. Washington State and local governments contract with various vendors that use both local and global supply chains to produce goods bought by public agencies. It is conceivable that these supply chains include victims of labor trafficking, yet the State does not currently monitor its supply chains nor require vendors to use a supply chain free from forced or trafficked labor. RECOMMENDATIONS Human trafficking is a complex problem that requires a multi-faceted approach to be 1 Sutapa Basu Ph.D and Johnna White MPA – University of Washington Women’s Center eliminated. Clean supply