Modern slavery is rampant in more than half of the world, and garment exporting nations are rated among the highest for risk.
According to a new global ranking released Thursday by risk analytics firm Verisk Maplecroft, modern slavery—defined as slavery, servitude, human trafficking and forced labor—is a “high” or “extreme” risk in 115 of the 198 countries in the index.
And of those, Asian and African nations pose the greatest threat to companies navigating new rules on supply chain disclosure.
More specifically, China and India—the top two apparel exporters to the U.S.—are rated “extreme risk.”
With the exception of the U.S. and EU, the world’s top 12 garment exporters are rated either high or extreme risk, too. China ranked 23rd highest risk, India 15th and Pakistan ninth. Bangladesh, Vietnam and Indonesia also made the unfavorable high or extreme risk list.
“Companies are heavily reliant on goods and raw materials from India and China. However, sourcing from these countries can come with a substantial risk of association with forced labor,” Verisk said. “The risk is endemic in India’s agricultural sector and is prevalent in parts of its garment sector. The exploitation of children in the mining of minerals is also common. Forced labor, including the exploitation of young apprentices, occurs across multiple sectors in China, including electronics production, mining and agriculture. These risks are echoed across many Asian markets.”
By comparison, the U.S. ranked 132 in the world and is considered medium risk because of the frequency of modern slavery cases reported in the country and some comparative shortcomings with regard to labor rights enforcement, according to Verisk. The EU is also rated medium risk, due in part to the region’s refugee crisis and the exploitation of both refugee and migrant workers.
“A key finding of the index is that how well states police labor rights really matters,” principal human rights analyst Alexandra Channer told Sourcing Journal. “A country might have good laws on paper; but, it is what they do in practice that best predicts whether their workers will be at risk workers from modern slavery.”
Naturally, corruption and inadequate oversight are key to labor law enforcement effectiveness.
In Sub-Saharan Africa, where companies are increasingly looking to as the next low cost labor locale, more than 80 percent of the countries in the region, including Kenya and Nigeria, are rated high or extreme risk.
With chasing cheap becoming a costly endeavor, brands should consider three things when thinking about sourcing in the up-and-coming region where few are quite yet too sure how business will go.
“Lower labor costs can backfire if that translates into worker exploitation,” Channer said. “Brands should be asking: Do wages cover living costs? Can all workers join independent unions? And, most importantly, how good is the government at monitoring and enforcing labor rights?”
For purposes of the index, Verisk assessed countries based on the prevalence of modern slavery and the country’s current and ongoing efforts to eliminate it, and its research was aligned with the definitions of slavery laid out in the U.K. Modern Slavery Act.
“Producing cheap clothes to meet fast fashion’s sudden, short deadlines is trapping the industry in a cycle of poverty wages and reliance on informal and anonymous sub-contractors,” Channer said. “Initiatives to establish a living wage and encourage independent trade unions are critical to better protecting the low-skilled, largely female workforce, from exploitation.”