Modern slavery and exploitation are critical challenges in the UK garment manufacturing and fast fashion sectors, which continue to require urgent attention from policymakers and regulatory agencies. Despite the potential for digital technology to enhance supply chain transparency, its effectiveness in mitigating labour exploitation is under-researched and underutilised. In this article, Dr Jon Davies, Professor Rose Broad, and Dr Amy Benstead outline research conducted by The University of Manchester and make key recommendations to address these challenges:

• Businesses show limited awareness of digital tools like Blockchain for helping to prevent exploitation.
• Only 17% of assessed modern slavery transparency statements mention using digital technology.
• Regulation of the industry is fragmented, which contributes to issues with preventative technologies being understood and/or adopted.

Transparency, modern slavery in garment manufacturing and digital technology

The concepts of ‘transparency’, and more recently, ‘due diligence’ in relation to supply chains appear to have permeated global corporate decision-making. Digital technology and artificial intelligence (AI) increasingly impact how garment companies transparently manage their supply networks, including within the sphere of concerns related to modern slavery. However, there is little existing research on how effective digital technology is in assessing transparency, especially in garment manufacturing, which is vulnerable to exploitative practices – including sweatshop-like conditions and underpayment.

In a similar vein, although the UK Modern Slavery Act 2015 requires large companies to publish an annual transparency statement to address exploitation, the consequences of not doing so are minimal. The quality of these statements varies significantly, yet AI technology is growing in importance to track companies’ commitments over time, which forms an important part of corporate transparency.

Challenges for fast fashion and manufacturing

The UK garment manufacturing and fast fashion sector faces significant challenges related to labour exploitation and modern slavery. Key issues include poor working conditions, underpayment, long hours without proper breaks, and a lack of job security.

In severe cases, workers may face threats and coercion, making it difficult to identify and stop exploitation. Additionally, complex supply chains and subcontracting obscure accountability, which can allow unethical practices to develop. Efforts to enforce legislation and ensure ethical standards are often insufficient or inadequately enforced, which contributes to the overall problem.

The above challenges have implications for the ways in which modern slavery and exploitation is regulated, and how digital technology can or should be incorporated into these regulatory processes.

Policy-relevant findings

The University of Manchester conducted an interdisciplinary research project in 2022-2023, which included conducting interviews with stakeholders who had some affiliation with, or connection to, the garment manufacturing industry in the UK – including manufacturers, employer associations, technology companies, auditors, regulators, and community organisations. This was complemented by a review of 118 modern slavery transparency statements from the fashion sector, which were selected based on their companies’ inclusion in the 2022 Fashion Transparency Index.

Our first key finding was that many businesses have a limited awareness of how digital technology such as Blockchain can be used to assist in preventing modern slavery and exploitation from developing in garment manufacturing supply networks. Commonly asserted benefits of tools such as Blockchain include a real-time ledger that all parties in a network/supply chain can access, which includes transaction details and contracts. Importantly, stakeholders cannot retroactively change this information without the consent of all parties in the network, which in theory improves accountability and trust among stakeholders. Nevertheless, most participants in our research were not familiar with Blockchain in day-to-day business usage.

Secondly, where businesses had some level of awareness, tools such as Blockchain tended to be seen as a ‘gimmick’ that did not address underlying explanations for modern slavery such as extensive use of subcontracting and pressure to minimise labour and product costs. Related to this, smaller businesses may lack the resources and/or expertise to implement Blockchain, whereas larger fashion brands were perceived as unwilling to implement it due to reputational concerns if cases of exploitation came to light as a result.

Thirdly, this lack of awareness and/or implementation was reflected in the transparency statements, where just 17% of our sample made any reference to using some form of digital technology in preventing modern slavery across their business and supply networks.

Regulation of the industry continues to be fragmented and largely reactive, whereby changes tend to be incremental, whether referring to legislation, regulatory interventions, or the voluntary efforts of businesses. In turn, this hinders the potential of digital technology such as Blockchain to be thoroughly understood and considered as a preventative and responsive tool.

Key recommendations for policy and regulation

Based on the above findings from our research, we make the following recommendations that are intended to benefit practitioners and policymakers:

• Facilitate a government consultation or inquiry that crosscuts policymakers, industry, regulators/enforcement, and academia on the relative merits and drawbacks of implementing tools such as Blockchain in garment manufacturing and the fashion industry more widely.
• Based on the previous recommendation, encourage and require businesses to avoid ‘tech-washing’ and associated human rights abuses by being clear about their actions on to what extent they use digital technology. Currently there is pending legislation – the Commercial Organisations and Public Authorities Duty Private Members’ Bill proposed by Baroness Young of Hornsey, which may provide a positive framework for this recommendation to take shape if it is adopted by the new incoming UK government. This legislation is in the same spirit as the EU’s new Corporate Sustainability Due Diligence Directive, which is intended to hold companies accountable for their actions related to environmental and labour/social standards.
• A continued push for a Single Enforcement Body (SEB) to merge key regulatory agencies such as the Gangmasters and Labour Abuse Authority, Employment Standards Agency Inspectorate, and HMRC National Minimum Wage Team. The SEB is not a new recommendation, despite being a commitment in the 2019 Conservative Party manifesto it was scrapped in 2022. However, the new Labour government included a renewed commitment to establish a SEB in their most recent manifesto, suggesting it is still a realistic policy goal.

In the longer term, we would advocate that garment manufacturing and all industries fall under the licensing remit of the GLAA / SEB – again, this is far from a ‘new’ recommendation but would be a key demonstration of a new incoming government’s commitment to improving workers’ rights.