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Governance Authority
Category: Third-Party and Supply Chain

Modern Slavery Due Diligence

Also known as: Modern slavery supply chain due diligence, Human rights due diligence for modern slavery
Simply put

Modern slavery due diligence is an ongoing process businesses use to find, prevent, and address the risk that forced labour or other forms of modern slavery exist in their operations and supply chains. It focuses primarily on the risk of harm to people, rather than only on risk to the business. Rather than a one-time check, it involves continuously mapping supply chains, assessing risks, taking preventative action, and monitoring the results.

Formal definition

Modern slavery due diligence is a structured, ongoing risk-management process directed at identifying, preventing, mitigating, and addressing modern slavery risks, such as forced labour, across an organisation's operations and value chain, with a defining emphasis on risk to people rather than solely risk to the enterprise. Practitioners generally describe it as having both process dimensions (e.g., mapping supply chains, assessing risks, implementing preventative measures, and monitoring) and outcome dimensions, and note that it should typically be proportionate to the size of the business and the severity and likelihood of the risks identified. Whether such due diligence is a binding legal obligation or a voluntary expectation depends on jurisdiction, sector, and entity type: under certain regimes, such as the EU Corporate Sustainability Due Diligence Directive (CSDDD), in-scope companies are required to identify, prevent, and address human rights risks including forced labour, while in other jurisdictions the emphasis may be on transparency reporting rather than a mandated due diligence duty. This entry describes the concept generally and is educational only, not legal, audit, or compliance advice; the specific requirements applicable to any organisation depend on the facts and the relevant legal framework.

Why it matters

Modern slavery due diligence matters because its defining focus is the risk of harm to people, individuals subject to forced labour and other forms of exploitation, rather than solely the risk to the enterprise. This reorients the exercise away from a narrow compliance or reputational lens and toward the identification and remediation of severe human rights harms that can occur deep within extended supply chains, often several tiers removed from the buying organisation and beyond the reach of a single point-in-time audit.

The stakes are also increasingly regulatory. Whether modern slavery due diligence is a binding legal obligation or a voluntary expectation depends on jurisdiction, sector, and entity type. Under certain regimes, such as the EU Corporate Sustainability Due Diligence Directive (CSDDD), in-scope companies are required to identify, prevent, and address human rights risks including forced labour across their value chains. In other jurisdictions, the legal emphasis may fall on transparency reporting rather than a mandated due diligence duty, and the concept of a positive obligation to actively manage risks has been the subject of policy discussion, including by bodies such as anti-slavery commissioners. Organisations therefore need to understand which framework applies to them rather than assume a single universal standard.

Because requirements and expectations continue to evolve, boards and management face a moving landscape in which good practice may exceed the current legal minimum in a given jurisdiction. Treating due diligence as an ongoing, proportionate process, rather than a one-off checklist, helps organisations respond credibly to both legal duties and stakeholder expectations. This entry is educational only and not legal, audit, or compliance advice; the specific obligations applicable to any organisation depend on the facts and the relevant legal framework.

Who it's relevant to

Boards and board committees
Directors, often through an audit, risk, or dedicated sustainability committee, are typically responsible for overseeing whether management has established a proportionate, ongoing due diligence process and for understanding the organisation's exposure to modern slavery risk. The board's role is generally one of oversight rather than day-to-day execution, including satisfying itself that resourcing and escalation arrangements are adequate given the severity and likelihood of identified risks.
Compliance and legal functions
Compliance and general counsel teams help determine which obligations apply given the organisation's jurisdictions, sectors, and structure, for example, whether an in-scope entity faces a mandated due diligence duty under a regime such as the CSDDD or a transparency reporting expectation elsewhere, and translate those into policies, contractual terms, and reporting. Because requirements vary and continue to evolve, this function is central to distinguishing binding legal duties from voluntary good practice.
Risk and procurement/supply chain teams
Those managing enterprise and operational risk, together with procurement and supply chain functions, generally own much of the process work: mapping operations and supply chains, assessing where forced labour and other risks are most severe and likely, implementing preventative measures with suppliers, and monitoring outcomes. Proportionality is particularly relevant here in directing finite resources toward the highest-risk parts of the value chain.
Internal audit and assurance providers
Internal audit and other assurance functions may evaluate whether the due diligence process is designed appropriately and operating as intended, and whether it is achieving its intended outcomes rather than simply completing activities. Their independent perspective can help the board test management's assertions about the effectiveness of controls addressing modern slavery risk.

Inside Modern Slavery Due Diligence

Risk Assessment and Mapping
The identification of where modern slavery risks (forced labour, human trafficking, bonded and child labour) may arise across an organisation's own operations and its supply chain, typically prioritised by factors such as geography, sector, workforce type, and reliance on subcontracting or recruitment intermediaries. This mapping generally informs where deeper due diligence effort is focused.
Supply Chain and Third-Party Diligence
Processes for understanding suppliers and business partners beyond the first tier where feasible, which may include questionnaires, contractual clauses, supplier codes of conduct, and, in some cases, site audits. The depth of diligence generally scales with assessed risk, and full visibility into extended supply chains is often difficult in practice.
Governance and Accountability
The allocation of responsibility for the modern slavery programme, which typically involves board or senior management oversight of the approach and management ownership of day-to-day implementation. Where a reporting obligation applies, approval of a modern slavery statement often sits with the board or equivalent governing body under certain regimes.
Policies and Controls
The documented commitments and procedures, such as anti-slavery policies, responsible recruitment standards, and whistleblowing or grievance channels, together with the controls designed to give effect to them. A distinction generally applies between how a control is designed and whether it operates effectively over time.
Remediation and Grievance Mechanisms
Channels through which affected workers or third parties can raise concerns, and the processes for responding to identified harm. Effective remediation is generally understood to focus on the interests of affected individuals rather than solely on protecting the organisation.
Monitoring, Reporting and Disclosure
Ongoing tracking of the programme's operation and, where applicable, external disclosure. Certain jurisdictions require in-scope organisations to publish a modern slavery or transparency statement describing their steps, though the specific content requirements, thresholds, and enforcement vary by jurisdiction and entity type.

Common questions

Answers to the questions practitioners most commonly ask about Modern Slavery Due Diligence.

Does completing a modern slavery statement mean an organization has actually met its due diligence obligations?
No. Publishing a statement and conducting substantive due diligence are distinct activities. In many jurisdictions, reporting-based regimes require an entity to disclose the steps it has taken (or, in some cases, to state that it has taken none), but the legal obligation is often centered on transparency rather than on achieving a defined due diligence outcome. A statement can satisfy a disclosure requirement while the underlying diligence remains limited. Conversely, some emerging regimes impose more substantive expectations to identify, prevent, and mitigate risks. Whether a statement discharges an obligation depends on the specific law, the entity type, and the applicable thresholds, so this distinction should be confirmed against the governing regime rather than assumed. This entry is educational and not legal advice.
Is modern slavery due diligence solely a compliance function's responsibility?
Not typically. While a compliance or legal function often coordinates reporting and monitors evolving requirements, effective due diligence generally draws on multiple functions and lines of accountability. Operational ownership frequently sits with procurement, supply chain, and human resources teams that manage supplier relationships and labor practices, with management responsible for embedding controls into day-to-day activity. The board or a designated committee typically holds oversight responsibility, including approving statements where required. Assurance functions such as internal audit may provide independent evaluation of control effectiveness. Treating this as a single-function task risks gaps in accountability. The precise allocation depends on the organization's structure and governance model.
How should an organization prioritize where to focus modern slavery due diligence across a large supply chain?
Prioritization is generally risk-based rather than attempting uniform coverage of every supplier. Organizations commonly assess factors such as sector, geography, workforce characteristics (for example, reliance on low-skilled or migrant labor), and the depth or opacity of supply tiers to identify where the risk of exploitation is more likely. This allows finite resources to be directed toward higher-risk relationships, with lighter monitoring elsewhere. The approach should be documented so the rationale is defensible, and revisited as the supply base and risk landscape change. Prioritization methodology depends on the entity's facts and its own judgment; this is not a prescriptive standard applicable to all organizations.
What is the difference between assessing a supplier's control design and its operating effectiveness in this context?
These are distinct evaluation steps and should not be conflated. Assessing control design examines whether a supplier's policies, contractual commitments, grievance mechanisms, and screening processes are appropriately structured to address forced labor and exploitation risks. Assessing operating effectiveness examines whether those controls actually function as intended over time in practice. A supplier may have well-designed policies on paper that are not operating effectively at the site level. Due diligence that relies only on documentary self-assessment tends to test design; site visits, worker interviews, and independent verification are more oriented toward operating effectiveness. The appropriate mix depends on assessed risk and available assurance.
How can a board obtain assurance that modern slavery due diligence is functioning as intended?
Boards or their designated committees typically seek assurance through a combination of management reporting and independent evaluation, rather than relying on a single source. Management reporting generally covers the scope of diligence performed, high-risk areas identified, and remediation actions. Independent assurance may come from internal audit reviewing the design and operating effectiveness of relevant controls, or from external verification where appropriate. Layering these sources reflects the principle of independent oversight distinct from operational ownership. The board's role is generally to challenge and oversee rather than to perform the diligence itself. The extent and formality of assurance appropriate for a given entity depends on its risk profile and applicable requirements.
How should an organization respond when due diligence identifies indicators of forced labor in its supply chain?
Practice generally favors a considered, remediation-focused response over immediate disengagement, since abruptly cutting ties can worsen outcomes for affected workers. Many frameworks and guidance documents emphasize using leverage to address and remediate identified harms, escalating where the supplier is unwilling or unable to improve, and reserving termination for situations where remediation is not feasible. Steps often include preserving relevant information, engaging the supplier on corrective action, and considering whether reporting to authorities or affected individuals is warranted. Because responses may carry legal, contractual, and reputational implications, and obligations vary by jurisdiction, organizations typically involve legal counsel and relevant functions in determining the appropriate course. This entry does not constitute legal or compliance advice.

Common misconceptions

Publishing a modern slavery statement means an organisation is compliant and its supply chain is free of modern slavery.
In many transparency-focused regimes, the legal obligation is generally to disclose the steps taken (or to state that none were taken), not to guarantee a slavery-free supply chain. Disclosure is a reporting duty and does not by itself demonstrate that risks have been eliminated or that due diligence is effective.
Modern slavery due diligence is a compliance box-ticking exercise owned entirely by the compliance function.
Effective due diligence is generally an ongoing, risk-based process that cuts across procurement, human resources, operations, and legal. While compliance may coordinate elements, management typically owns implementation and the board or senior management typically holds oversight; treating it as a one-off document usually misses the operational reality.
The requirements are the same everywhere, so one approach satisfies all obligations.
Obligations vary significantly by jurisdiction, sector, and entity type, including different thresholds, content expectations, and whether the regime is disclosure-based or imposes broader due diligence duties. What satisfies one regime may not satisfy another, and this entry is educational rather than legal or compliance advice.

Best practices

Adopt a risk-based approach that prioritises due diligence effort according to assessed geography, sector, and workforce-type risks rather than applying uniform effort across all suppliers.
Clarify accountability by distinguishing board or senior-management oversight of the programme from management ownership of implementation, and document where each responsibility sits.
Extend diligence beyond first-tier suppliers where feasible, using proportionate tools such as supplier codes of conduct, contractual clauses, questionnaires, and risk-based audits, while recognising the practical limits of supply-chain visibility.
Establish accessible grievance and remediation mechanisms focused on affected workers, and define how identified harm will be responded to in practice.
Distinguish control design from operating effectiveness by periodically testing whether policies and controls actually function, not just whether they exist on paper.
Confirm the specific disclosure and due diligence obligations applicable to the organisation's jurisdictions and entity type, and seek qualified professional advice where requirements are uncertain.