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Modern Slavery
" We are committed to addressing modern slavery and human trafficking across our investment activities and in our business. The investment industry plays an essential part in creating the change needed to protect people from modern slavery, labour exploitation and human trafficking."
Anne Richards, Vice Chair at Fidelity International
Modern Slavery matters at Fidelity
As a company we will not knowingly invest, support or conduct business with any organisation involved in slavery and human trafficking and aim for high standards of governance throughout our organisation.
We consider the longer term financial and societal consequences of our decisions and actions. As global investment managers, we have a clear responsibility to hold corporate management to account and to help shape the companies of the future by investing sustainably today.
Legal landscape
The UK (UK Modern Slavery Act 2015) and Australia (Australia Modern Slavery Act 2018) are pieces of legislation which requires companies to do more to assess and address the modern slavery risks in their business operations and supply chains.
Companies subject to these laws are required to submit a statement to their respective government registries annually that provides transparency on what they have done to assess, address, and remediate modern slavery risks in their business operations and supply chains.
Fidelity’s UK and Australian Modern Slavery Transparency statements can be found on our respective country websites.
What is Modern Slavery?
Modern Slavery is a criminal offence and includes exploitative deprivation of human liberty by another individual or organisation with the intention of obtaining personal or commercial gain.
It is all around us, often hidden in plain sight. People can become enslaved making our clothes, serving our food, picking our crops or working in factories.
It takes many forms
Human trafficking
The use of violence, threats or coercion to transport, recruit or harbour people in order to exploit them for purposes such as forced prostitution, labour, criminality, marriage or organ removal
Forced Labour
Any work or services people are forced to do against their will, usually under threat of punishment
Debt bondage/bonded labour
The world’s most widespread form of slavery. People trapped in poverty borrow money and are forced to work to pay off the debt, losing control over both their employment conditions and the debt
Child Slavery
When a child is exploited for someone else’s gain. This can include child trafficking, child soldiers, child marriage and child domestic slavery
Forced and early marriage
When someone is married against their will and cannot leave. Most child marriages can be considered slavery
Descent–based slavery
A very old form of slavery, where people are treated as property, and their “slave” status has been passed down the maternal line
Domestic servitude
When someone is working in another person’s home, they may be particularly vulnerable to abuses, exploitation, and slavery, as they might be hidden from sight and lack legal protection
Modern Slavery in Numbers
There is an estimated 49.6 million people living in modern slavery today.
1 in 4
are children
27.6 million
in forced labour
22 million
in forced marriages. *2 out of 5 of those in forced marriages are children
54%
are women and children
*Source – www.walkfree.org
What are we doing at Fidelity to mitigate against Modern Slavery?
Our purpose is to work together to build better financial futures and we believe investing sustainably can help us achieve our purpose.
As a fundamental, research-led active manager, our principal influence is through our investment processes. Integrating sustainability factors into our investment process has the potential to positively impact the short and long-term value of issuers and can protect and enhance investment returns. Sustainable investing is about understanding material non-financial factors that impact the long-term value creation of companies we invest in or lend to.
Collaboration with others
Fidelity works closely with policymakers, industry groups and non-governmental organisations with an overall aim to improve sustainable behaviours by businesses globally.
We are a Signatory to the United Nations Principles for Responsible Investment (“UNPRI”) which is a voluntary framework for incorporating ESG issues into investment decision-making and ownership practice. In addition we are also a signatory to the UK Stewardship Code, the EFAMA Stewardship Code, the Japanese Stewardship Code, Taiwan’s Stewardship Principles for Institutional Investors and the Hong Kong Principles of Responsible Ownership.
A priority focus
Modern slavery and labour exploitation in the supply chain has been a priority focus for Fidelity since 2018. We believe that every company must manage its supply chain in a way which has due regard to labour issues, including but not limited to modern slavery and human trafficking concerns.
This focus on supply chain sustainability is evidenced through the following external commitments -
- Founding member of Investors Against Slavery and Trafficking Asia-Pacific (IAST APAC) - aims to address and prevent modern slavery and human trafficking risks across corporate supply chains.
- Part of a UK-based initiative to address Modern Slavery in supply chains called “Find it Fix it Prevent it”. The objective is to help companies develop and implement better processes for finding, fixing, and preventing modern slavery in companies’ supply chains.
Our ESG Ratings assess an issuer’s management of its supply chain in relation to social and environmental matters.
Further information on our sustainability approach can be found in our Sustainable Investing Principles
Our Responsible Supply Chain vision is that our supply chain will create value-for-money, generating benefits to both Fidelity International and broader society. This can be achieved through running ethical, social and environmentally responsible procurement practices and supplier management.
In early 2021, we introduced a new sustainability ratings provider which focuses on assessing the ESG performance of Fidelity’s suppliers on environment, labour and human rights, ethics and sustainable procurement. This provides for ongoing monitoring and oversight and to address improvement areas identified into corrective action plans for remediation or continuous improvement.
Fidelity does not tolerate modern slavery or human trafficking within its business operations and takes a risk-based approach regarding its supply chain.
Our risk-based approach includes the following:
- Sustainability assessment for all material outsourcing, high risk and high spend suppliers which covers seven management indicators, across 21 sustainability criteria, in 4 themes –
(1) Environment
(2) labour & human rights,
(3) ethics and
(4) sustainable procurement. Template supplier agreements which contain a requirement to comply with all applicable anti-slavery and human trafficking laws.
Due diligence screening of all non-low risk suppliers.
Risk assessment of all suppliers being onboarded to assess the inherent risk the supplier and its service brings to Fidelity.
Suppliers are required to accept the Fidelity supplier code of conduct which sets out the standards and behaviours we expect from our suppliers including Modern Slavery requirements.
Further information on our responsible supply chain vision can be found here.
At Fidelity we have established both a Corporate Sustainability Committee and Sustainable Investing Operating Committee at the most senior level of management to embed sustainability into how Fidelity operates as a company and as to how Fidelity invests as a fiduciary on behalf of our clients.
We take responsibility for our impact on society as a whole through our corporate activities as well as through our investment activities.
Fidelity has various policies in place which document our commitment to mitigate against Modern Slavery. These include the Code of Conduct, Financial Crime Prevention Policy, Procurement Policy and Sustainable Investing Principles.
Compulsory online training is provided to all staff on an annual basis with targeted training for employees in business functions involved in recruiting, sourcing and those managing a supply chain. All procurement staff receive specific training on an annual basis highlighting the indicators, risks, impacts and Modern Slavery in the Supply Chain.