Slavery in Supply Chains is Monstrous
Nearly 25 million people are working in forced labor conditions according to the International Labour Organization (ILO) and Walk Free Foundation. These enslaved people work in agriculture, mining, and manufacturing. Given the prevalence of modern slavery, the UN Sustainable Development Goals (SDG) include Target 8.7, which calls on corporations to “Take immediate and effective measures to eradicate forced labour, [and] end modern slavery and human trafficking...”
Modern slavery is a material risk for shareholders given the potential for litigation and loss of revenue by brand-association with slavery.
In the last few years, lawmakers in California, U.K., France and Australia have introduced or passed legislation to address modern slavery. Know the Chain has released benchmarks that focus on modern slavery in the Information & Technology Communication, Food & Beverage and Apparel & Footwear sectors. Its Food & Beverage Benchmark Findings Report scored Monster Beverage at zero (0) out of 100 – dead last. The report stated, “Monster Beverage Corporation places last on the benchmark, underperforming across all thematic areas relative to its peers.” The score reflects poor transparency and disclosure in managing forced labor risks in its supply chain. In contrast, Coca-Cola, Nestlé and Pepsico, scored 58, 57 and 45, respectively.
What should concern Monster, and many companies, is that harvesting, extracting or processing raw materials often includes forced labor. Monster products have ingredients derived from cane sugar. The production of sugar cane in Bolivia, Brazil, Dominican Republic, Guatemala, India, Myanmar and Pakistan all have known forced labor problems, according to the U.S. Department of Labor.
Monster deems its supply chain to have “minimal risk of slavery and human trafficking,” even though it has not disclosed what practices it has in place to address forced labor. Monster also does not report on supply chain transparency, or monitoring and certification. By contrast, Coca-Cola, a major Monster shareholder, discloses a map highlighting countries of origin, while other peers disclose names and addresses of sugar suppliers.
Modern slavery must stop. Through the SDGs, the global community has committed to eradicating all forms of forced labor by 2030. As shareholders, we must hold companies accountable to set policies, implement risk analyses, and address forced labor embedded in their supply chains. As You Sow, with input from the Responsible Sourcing Network (RSN), has filed the first forced labor resolution at Monster Beverage, asking it to issue a report disclosing its methodology for determining its “minimal risk to slavery” assessment.
While resolutions are appropriate for industry laggards, shareholders are also working collaboratively with industry leaders and human rights defenders. Building off support for corporate action to address conflict-free mining in the Congo, RSN encourages international apparel brands to implement due diligence in the middle of the supply chain. RSN’s initiative YESS: Yarn Ethically & Sustainably Sourced aims to eradicate forced labor in cotton production by replicating the conflict-free smelter model with yarn spinners.
We invite shareholders to join RSN’s efforts to ensure greater corporate responsibility to end modern slavery in global supply chains.
Patricia Jurewicz
Director, Responsible Sourcing Network