Linkage to Human Trafficking Could Cause Irreparable Damage to a Company

Businesses need to thoroughly understand their supply chains in order to avoid becoming complicit in human trafficking, according to a White Paper from Kroll.


Human trafficking is the third largest illicit trade in the world, after the illicit trade of arms and drugs. Of an estimated 21 million human trafficking victims, half are in the Asia Pacific region, with a large proportion of those in Southeast Asia.


Most victims are pressed into bonded and forced labor, whilst 10% are forced into the commercial sex industry.


Industries most likely to be connected with forced labor include: agriculture, fishing and seafood, garments and textiles, mining, logging, construction, hospitality and tourism.


Growing anti-trafficking legislation puts the onus on companies and investors to properly investigate their supply chains and effectively manage the legal and reputational risks to their businesses.


“Aside from violating international and national laws, linkage to trafficking has the potential to cause irreparable damage to a brand, to customer demand or to a stock price," says Richard Dailly, managing director for South and Southeast Asia. “Since the most likely form of involvement comes from being indirectly linked with trafficking along the supply chain through the actions of partners, suppliers, contractors, labor brokers or employment agencies, we advise investors to assess the likely risk to their business from unwitting complicity in the human trafficking trade and consider a thorough audit of their supply chains in order to mitigate against such risk.”

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