Social Accountability in the Fishing Industry
The last great challenge of ethical food production?
By: Mike Mitchell, Fair Seas Limited
Unlike any other part of the modern food system, fishing boats are difficult to observe and monitor. The very nature of the fishing industry means that workers carry out their duties beyond the reach of standard due diligence processes such as routine audit and inspection. In recent years, concerns over exploitative labour practices on fishing vessels have been increasingly reported in the European and US media – these allegations of mal-practice range in severity from incidents of poor man-management and inequities of payment terms between flag state nationals and migrant crew members, to the most extreme forms of forced labour and slavery. Whilst some of these stories document high profile and extreme human rights abuses in developing world nations, others have highlighted less severe, but still concerning issues in the UK and other EU fisheries.
Types of labour abuses encountered in the fishing industry
- Exploitive recruitment practices
- Lack of written employment contracts
- Non or under payment
- Debt bondage
- Abandonment in port
- Failure to adequately protect fishers against work related injuries
- Failure to provide adequate medical care
- Loss of life at sea
- Excessive working hours, fatigue and lack of rest
- Inadequate accommodation and ablution facilities
- Lack of adequate potable water supply
- Use of child labour
- Inability to contact friends and family
- Human trafficking
Should such malpractice be proven in the upstream supply chains of retailers, food service businesses or seafood brands, it would represent a significant risk to business integrity and the potential loss of consumer confidence. There is also the possibility of hostile litigation – the emergence of CLASS action lawsuits in the US targeting businesses which allegedly (knowingly) sell seafood products which have been produced using Modern Day Slavery sets a worrying precedent for brand owners. This development is of particular pertinence in the UK since the passing of the Consumer Rights Act in 2015, which now enables similar CLASS action lawsuits under UK law.
Increased Supply Chain transparency
Recent regulatory changes in the U.S. and the U.K. have seen the introduction of legislation which places a burden of proof on large businesses that they are taking adequate measures to ensure that slavery is not used in their upstream supply chains.
The Californian Transparency in Supply Chains Act and the U.K. Modern Day Slavery Act will have consequences for businesses that supply into these markets.
The California Transparency in Supply Chains Act became law in October 2010 and went into effect in January 2012. It requires companies above a certain size to report on their specific actions to eradicate slavery and human trafficking in their supply chains. Aimed at mid-size and large retailers and manufacturing companies with worldwide annual revenues of $100 million or more, the law’s chief goal is to ensure companies provide consumers with information that enables them to understand which ones manage their supply chains responsibly. It is estimated that the reporting requirement will impact about 3,200 companies headquartered in California or doing business in that state.
Specifically, the law requires a company to disclose on its website its initiatives to eradicate slavery and human trafficking from its direct supply chain for the goods offered for sale. A company must disclose to what extent it:-
- Engages in verification of product supply chains to evaluate and address risks of human trafficking and slavery
- Conducts audits of suppliers
- Requires direct supplies to certify that materials incorporated into the product comply with the laws regarding slavery and human trafficking of the countries in which they are doing business
- Maintains accountability standards and procedures for employees or contractors that fail to meet company standards regarding slavery and human trafficking
- Provides employees and management training on slavery and human trafficking
In the U.K. the new Modern Day Slavery Act is designed in seven parts, and specifically; Section 6 on Transparency in Supply Chains is closely modeled on the Californian legislation. The public reporting obligation of Section 6 applies to businesses operating in the UK with a turnover in excess of £36 million, this is expected to impact around 17,000 businesses. Businesses are expected to report on the following:
- Its structure, its business and its supply chains
- Its policies in relation to slavery and human trafficking
- Its due diligence processes in relation to slavery and human trafficking in its business and supply chains
- The parts of its business and supply chains where there is a risk of slavery and human trafficking taking place, and how to assess and manage that risk
- Its effectiveness in ensuring that slavery and human trafficking is not taking place in its business or supply chains, including appropriate KPIs
- Its staff training on slavery and human trafficking
Developing a toolkit to demonstrate supply chain transparency
Whilst ethical trade assessments are now widely incorporated into third party certification standards for aquaculture and for shore based operations, labour conditions in wild capture fisheries remain difficult to observe and monitor. It is becoming increasingly unlikely that developed world markets will continue to accept this situation on the basis that it has been considered historically difficult to build due diligence processes around the at-sea industry.
Whilst there is a strong regulatory framework and a range of ‘off the shelf’ ethical trade tools and services for the onshore manufacturing sector, the regulatory environment for the maritime sector is less well defined, and there are still relatively few resources available for seafood buyers to apply in their at-sea supply chains.
It is inevitable that such services and tools will need to be developed, and given the high profile attention that this issue is now receiving, we may expect increasing demands from the major global seafood buyers on issues related to assuring labour conditions at sea.
Two factors have recently combined to heighten awareness amongst major seafood brands, retailers and food service businesses of their social accountability responsibilities for the at-sea parts of their upstream supply chains.
- Increased media scrutiny and investigative journalism – specifically in Thailand, but also closer to home in the UK/EU.
- A changing regulatory environment, with the introduction of legal requirements for the public reporting by businesses on the measures taken to identify and avoid slavery in their upstream supply chains.
These conditions have raised a number of very pertinent challenges for the seafood industry:
- How can responsible fishing vessel/fleet operators offer robust reassurance to their customers that their fishermen are being treated ethically?
- How can consumer-facing businesses build risk analysis metrics and risk mitigation processes to help guide their buying policies?
- What is the role of third party inspection and ethical trade standards for the at-sea sector?
- What is the regulatory landscape at sea and how can flag States align behind robust and harmonised legislation on the seas?
- If the industry does not address this issue itself, will it be ‘outed’ by the media and the NGOs?
In the coming years, the seafood industry will surely face up to these challenges, we will see a suite of new tools and information sources becoming available and ultimately being deployed into at-sea supply chains as standard good fishing practice. Continued NGO pressure and media focus will help to drive the development of these new standards, but the industry itself has a major role to play in delivering them. Doing the right thing because somebody is watching over you is one thing, but doing the right thing because it is the right thing to do is a whole different scenario and we have perhaps already seen the emergence of early leaders in this area.