Why investors cannot ignore modern slavery risk

Both developed and emerging markets susceptible

Modern slavery - typically defined as contemporary forms of servitude, forced labour and human trafficking - has increased in prominence in recent years, and jurisdictions such as the UK, Australia and the US state of California have introduced legislation aimed at improving disclosure of modern slavery risk by companies.

The challenge for investors is to go beyond putting out broad statements of concern or asking ad hoc questions about the topic to companies and instead to integrate modern slavery risk mitigation into a robust and repeatable investment process. In this way it represents an example of how investors can integrate emerging ESG risks before they are well understood by the market. To start, investors need to distinguish the relevance of modern slavery to a portfolio in terms of its salience and its materiality. Julia Dreblow: The truth behind building SRI portfolios In this context, ...