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Friday
Aug122016

Measuring the risk of slavery in today's economy

A new report from the risk management firm Verisk Maplecroft issues a stark warning to businesses -- and consumers -- across the globe: slavery is rife in nearly 60% of countries around the world.

This report garnered substantial media attention this week for its assertion that nearly 46 million people worldwide are living as slaves, and that this problem is not limited countries with underdeveloped markets and struggling legal systems.

Further, while precise estimates of the number of slaves differ, there is broad agreement that there are more slaves today than any time in human history. In fact, according to a 2012 article in the Atlantic, over the entire 350 years of the African slave trade, a total of 13.5 million were taken from Africa to be slaves; that's less than one-third of the current number.

While the report notes that most multinational companies have robust systems in place to guard against slavery among their top suppliers, there is more risk further down the value chain. Some other key findings include:

  • With the exception of the US and EU, the world’s top 12 garment exporters, including China (ranked 23rd highest risk), India (15th) and Pakistan (9th) are rated ‘high’ or ‘extreme risk’
  • Over 80% of sub-Saharan African countries feature in the two highest risk categories, including Kenya and Nigeria, two of the region’s three largest economies 

Groups that we are particularly interested in, such as small farm operations, are not immune -- cocoa producers are also considered to have a heightened risk, for instance. An economic system built on mutually beneficial relationships has no place for slavery, so this is a risk that should be closely watched.

 

Image source: Verisk Maplesoft

-- Jay Jakub

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