The end of the year was marked by noteworthy developments in respect of business and human rights issues, from the UK Government's response to the Modern Slavery Act Committee Report, the legal developments in the Dyson case, to the persistent labour issues within the garment industry, here is a summary of the key events from the last month:
- ??? The UK Government has responded to the House of Lords Modern Slavery Act 2015 Committee's report, highlighting key points such as consideration of further safeguards for migrant care workers, and a review of penalties for non-compliance with supply chain requirements. However, the Government has stopped short of introducing mandatory human rights due diligence or enforcement penalties where companies fail to publish a modern slavery statement.
- ??Swedwatch supports Sweden’s move to implement the EU's Corporate Sustainability Due Diligence Directive (CSDDD) but criticises the government's approach to only meet the minimum requirements. The organisation calls for a more comprehensive implementation, including broader company coverage and involvement of civil society, to ensure the law effectively protects human rights and the environment
- ?????? According to the OECD, 52 governments spent over USD 8.3 trillion on public procurement in 2021. Of this, USD 6 trillion (73%) came from countries with due diligence regulations for public institutions, indicating that governments are leading by example in aligning public spending with sustainability goals.
- ????? Over 90 organisations have expressed concern over the misrepresentation of EU sustainability reporting, urging European leaders to focus on smart implementation rather than disrupting the legal framework.
- ????? The Canadian Sustainability Standards Board (CSSB) has released its Canadian Sustainability Disclosure Standards (CSDSs), largely aligned with the ISSB's global standards, but offering extended timelines for reporting on elements like Scope 3 emissions. This marks a key step in Canada's efforts to establish a mandatory sustainability reporting system.
- ???? ?The European Financial Reporting Advisory Group?(EFRAG) has released a voluntary sustainability reporting standard for non-listed SMEs, designed to help small companies report on ESG issues in a simplified and consistent manner.
- ????? The EU has adopted new rules requiring all packaging to be 100% recyclable by 2030, alongside targets to reduce overall packaging waste.
- ?????? The UK Court of Appeal has ruled that a case against Dyson, brought by migrant workers in 2022 alleging forced labour and dangerous conditions at Malaysian factories, can proceed in English courts. The workers, who claim they were subjected to abuse and hazardous conditions, argue that Dyson is responsible due to its knowledge of the situation, despite the company's denials.
- ????? The DRC has filed criminal complaints in France and Belgium against Apple subsidiaries, alleging the use of conflict minerals linked to war crimes and tainted supply chains. Apple denies the claims, citing supplier audits, recycled materials, and strict sourcing policies for 3T minerals.
- ???? A US federal appeals court rejected Starbucks' challenge to a National Labor Relations Board (NLRB) decision, which found that the company illegally fired two baristas for attempting to unionise. The court upheld the NLRB's ruling but limited the damages Starbucks was required to pay, siding with the agency's authority while dismissing claims about constitutional issues.
This month, there was a focus on the garment industry and its negative social and environmental impacts. Issues such as labour exploitation—including low wages, unpaid overtime, illegal recruitment fees, and child labour—are widely reported.
Businesses in the garment sector need to reassess their procurement practices to understand how they may be vulnerable to human rights violations. For example, price squeezing and quick turnaround times create significant financial pressure on suppliers, leading to extensive outsourcing and widespread labour violations. To avoid contributing to these violations, businesses should adopt sustainable procurement practices and implement robust due diligence processes that address modern slavery risks. An increasing number of brands are now under scrutiny, and for many, fulfilling due diligence obligations is no longer optional but a legal requirement.
- ?????? Public Eye published the "One-Earth Fashion" report calling for a radical transformation of the fashion industry, addressing its environmental and social injustices. The report proposes 33 specific targets for 2030 to create a more sustainable, fair, and eco-conscious system. A series of online discussions will accompany the report from January to April 2025, exploring actionable steps toward change.
- ????? KnowTheChain issued an assessment revealing that ultra-fast fashion models, particularly Shein, exacerbate labour rights risks, including forced labour, due to financial strain on suppliers. The evaluation highlights significant gaps in Shein's efforts to address these issues, signalling potential risks for investors.
- ????? Myanmar garment workers in Chinese factories in Ruili face severe exploitation, including arbitrary wage assignments, long shifts, and unpaid overtime. Many workers are recruited through labour brokers and endure harsh conditions at the Muse-Ruili border, with some trapped in warehouses for months due to new regulations. Exploitative practices persist as workers face threats of deportation if they protest or refuse to work.
- ????? The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has instructed factories to implement a 9.0% annual wage increase for workers, starting in January 2025, following a decision by the labour ministry. This hike, which increases the previous 5.0% increment, aims to address labour unrest and promote harmony between workers and factory owners.
- ?????? An investigation by STAND.earth Research Group reveals over 100 fashion brands, including Zara, H&M, and Lululemon, source fabrics from fracked oil and gas in Texas’ Permian Basin. The group’s “Fracked Fashion Map” links these brands to petrochemical-based materials, highlighting the fashion industry’s deep reliance on fossil fuels. With synthetic fibres set to dominate 73% of global production by 2030, the report underscores the urgent need for sustainable alternatives and greater transparency.
- ????? In December 2024, Brazilian authorities halted the construction of a?factory for Chinese electric vehicle manufacturer BYD after discovering forced labour conditions among Chinese workers at the site, including poor living conditions and withheld wages. Over 160 workers were rescued, and BYD terminated its contract with the contractor, Jinjiang Construction, while calling the allegations a smear against Chinese brands. Investigations are ongoing, with an online hearing scheduled for BYD and Jinjiang to address the issues.
- ?????? Human Rights Watch reports widespread labour abuses in Saudi Arabia's giga-projects, including NEOM and Red Sea, citing wage theft, hazardous conditions, and exploitation of migrant workers. It urges companies and FIFA sponsors to address these violations ahead of the 2034 World Cup.
- ???? Nigerian women recruited to work as domestic helpers in Iraq face severe abuse, including sexual assault, physical violence, and exploitation. Despite being promised good pay and conditions, many end up trapped in modern slavery, working long hours for minimal wages under abusive circumstances.
Ardea International understands that businesses must ensure that they meet their legal compliance obligations, develop robust policies and establish effective due diligence procedures . We support our clients by helping them identify how to manage potential and adverse impacts and risks, ensuring they meet legal compliance obligations and integrate best practices into their policies, procedures, and company culture. We do this by harnessing our legal expertise and through robust engagement with stakeholders and bespoke capacity building to provide the foundations for sustainable, and responsible business practice.
We also offer capacity building through training on sustainable procurement, child labour risks and human rights due diligence among other topics. You can find our training calendar for the first two quarters of 2025 here. ?
To find out more about how we can support you, get in touch with us at: [email protected]
Lastly, Ardea and Labor Solutions would like to invite you to join us for an independent pre-event side roundtable at the OECD Forum, scheduled for early February. This online roundtable will focus on understanding shared responsibility for implementing human rights due diligence in the apparel sector. You can register your interest here.
