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We’ll need more than disclosure to stop worker abuse in supply chains

Forced labour is widespread in the global production of dozens upon dozens of categories of goods, many of them imported into and sold in great quantities in Canada. This makes it almost certain that some businesses in Canada are profiting, knowingly or not, from forced labour in their supply chains, obtaining goods produced cheaply on the backs of abused and underpaid workers.

It’s widely accepted that corporate buyers bear some responsibility for fixing this problem. The UN’s guiding principles on business and human rights — which are endorsed by the Canadian government and many leading business associations — say that every company should undertake human rights due diligence, including in relation to their supply chains. This means a company must make careful efforts to find out if it’s linked through its supply chain to human rights abuse, to stop contributing to it, and to use its leverage with its supplier(s) to ensure that the abuse ends and the victims receive remedy.

But while the governments of many wealthy nations have agreed these are the rules corporations should follow, only a few — France, Germany, and Norway, for instance — have made them legally enforceable. They’ve done this by adopting mandatory due diligence laws.

Instead of following their lead, Canada is widely expected to adopt a law that will merely require companies to say what they’re doing, if anything, about the risk of forced labour in their supply chains.

Under Bill S-211, large firms would have to publish annual reports stating the steps they’ve taken “to prevent and reduce the risk” that forced or child labour is used in their supply chains. No particular steps would be required. Whatever steps the company took, no matter how minimal or ineffective, it would meet its legal duties by stating them in a report.

Surely Canada can do better than this.

First off, it could get serious about enforcing the one legal provision it already has on the books to combat forced labour in supply chains. Formally, the Customs Tariff requires companies to do what S-211 would only encourage them to do: make sure they’re not importing goods produced by forced labour. This provision has gone almost entirely unenforced, however, raising serious doubt that it’s driven any meaningful change in companies’ purchasing decisions.

As of May 2022, almost two years after the provision came into force, Canadian authorities had detained only one shipment of goods allegedly produced by forced labour. This underwhelming result is not surprising, given critical weaknesses and limitations in Canada’s enforcement framework. It’s time for a credible plan to resolve these problems.

Second, Canada could adopt a mandatory human rights due diligence law, as so many academics and legal experts have called for during parliamentary study of Bill S-211. Such a law has already been tabled in Parliament as Bill C-262, the Corporate Responsibility to Protect Human Rights Act. Under this law a company could face liability if it contributes in any way, including through its supply chain decisions, to human rights violations abroad.

Increasing corporate transparency is a worthy goal, but for Canada to make this its top legal priority in the fight against forced labour would be woefully misdirected. Much higher on the list should be enforcing the Customs Tariff import ban and adopting a mandatory due diligence law.

Visit non-negotiable.ca to send a message to your MP calling for the adoption of a mandatory human rights and environmental due diligence law.