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Blacklist companies profiting from Uighur abuses, say MPs
18/03/2021
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The UK government should create a blacklist of companies that fail to meet obligations to uphold human rights throughout their supply chains, a parliamentary committee has recommended following a report released on 16 March that there was “compelling evidence” businesses were “complicit in the forced labour of Uighurs” in China.

In its report, the business, energy and industrial strategy committee said there was mounting evidence the Uighur population in Xinjiang, northwest China, has been “the subject of systematic human rights violations”, sanctioned by the government in Beijing and with the products of forced labour contributing to UK supply chains.

The committee said it was “deeply concerned” that well-known companies in the fashion, retail, media, and technology sectors could not guarantee their supply chains are free from forced labour and was “disappointed by the lack of meaningful action” taken by the UK government to address human rights abuses.

While many companies called on to give evidence asserted robust procedures for prohibiting abuses, the committee said they were failing to undertake basic due diligence procedures to ensure supply chains are not implicated in slave labour or the abuse of minorities in China.

The committee singled out online fashion retailer Boohoo for maintaining only minimal data about the different tiers in its supply chain, resulting in labour abuses in the UK, as well as the Walt Disney Company for failing to “engage meaningfully” with the inquiry, specifically concerning the filming of “Mulan” in Xinjiang.

The evidence of the scale and severity of the human rights violations being perpetrated in Xinjiang against the Uighur Muslims is now far-reaching

Since 2017, more than one million members of the Muslim minority community in China have been sent to what Beijing has called “vocational training centres” in Xinjiang.

In September 2020, the Guardian reported that, upon “graduating” from these re-education camps, Uighurs are used as a source of free labour in factories throughout China, as well as in the cotton fields of western Xinjiang, the source of 85% of China’s and 20% of the world’s cotton.

Several fashion brands said they were looking to improve traceability within their supply chains, but it remains difficult to fully trace the origin of cotton used in garments.

A briefing from the Australian Strategic Policy Institute in February 2020 identified more than 82 foreign and Chinese companies benefiting from the exploitation of Uighur workers, including Adidas, Amazon, Apple, Google, Jaguar, Land Rover, Nike, Samsung, Uniqlo, Victoria’s Secret, and Zara.

On 12 January 2021, the Foreign Secretary, Dominic Raab MP, stated that “the evidence of the scale and severity of the human rights violations being perpetrated in Xinjiang against the Uighur Muslims is now far-reaching. It paints a truly harrowing picture”.

On 11 March, the Home Office “strongly encouraged” UK companies to make use of a modern slavery statement registry, an online platform for organisations to share the positive steps they have taken to tackle and prevent modern slavery.

However, the parliamentary committee said it was “disappointed” there were no significant new measures prohibiting businesses from profiting from forced labour, as well as “deeply concerned” over reports the UK government had procured covid-19 personal protective equipment from factories in China and North Korea implicated in modern slavery.

The committee said the government cannot “stand idly by” while companies operate with “wilful blindness” to forced labour and profit from human rights abuses. MPs recommended the government introduce tougher fines and strengthen the transparency obligations within 2015’s Modern Slavery Act, which has “not kept pace” with changes in business supply chains, is “out of date”, and has “no teeth”.

Among other recommendations in the report, MPs suggest white and black lists for companies with links to China, imposing Magnitsky sanctions on Chinese officials, and a review of the Company Directors Disqualification Act (1986) to determine whether breaches of the Modern Slavery Act should be the basis for future disqualification for company registration or director duties.

It is not a matter of whether New Zealanders are unknowingly supporting forms of modern slavery through their purchasing practices, but rather where this is happening and to what extent

Earlier this month, the European Parliament voted to introduce new laws that would hold international companies accountable when their actions infringe human rights, specifically highlighting the repression of Uighurs, and this week 85 corporations – including Coca-Cola NZ, EY, and PwC – signed a joint letter calling for an inquiry into whether New Zealand needs a Modern Slavery Act.

More than 40 million people find themselves in modern slavery, and around 25 million are subject to forced labour worldwide, according to international human rights group Walk Free. Despite two-thirds of all people in modern slavery living in the Asia-Pacific region, New Zealand currently has no legislation addressing transparency in supply chains for businesses among its main trading partners.

“We are part of a very interconnected global economy and social ecosystem,” said Reuben Casey, CEO of clothing retailer Kathmandu. “It is therefore not a matter of whether New Zealanders are unknowingly supporting forms of modern slavery through their purchasing practices, but rather where this is happening and to what extent.

“Effectively addressing the risks of modern slavery will stand and fall on our ability to let go of our corporate egos and be transparent about our businesses, our supply chains and our shared humanity, all of which are very imperfect.”

Last September, New Zealand’s Ministry of Business, Innovation and Employment produced a draft plan to combat forced labour, people trafficking, and slavery. Meanwhile, the Biden administration has offered its support to a proposed bill in Australia banning imports from the Xinjiang region, according to reports.

The US House of Representatives has reintroduced a bipartisan bill that would ban imports from Xinjiang unless proof is provided that goods are free from forced labour. The United States introduced a ban on cotton and tomato products in January 2021 during the waning days of the Trump administration.