17 – California Transparency in Supply Chains Act

Ending Human Trafficking Podcast Logo

Dr. Sandra Morgan and Dave Stachowiak discuss the Transparency in Supply Chains Act that will become law in the State of California on January 1st, 2012. This new legislation helps to ensure ethical labor practices for companies based in California, which can also create a trickle effect and create greater ethical supply chain standards around the world.

Key Points

  • Transparency in Supply Chains Act requires companies to disclose their efforts in ensuring that their direct supply chains are free of slavery and human trafficking.
  • Addressing slavery regarding the law of supply and demand through our consumer practices is good, but we need to also address legislation and laws to enforce slave-free supply chains.
  • If the consumer is knowledgeable about what kind of accountability the law is requiring, we can ask better questions to hold companies accountable.
  • Consumers have a responsibility to hold companies accountable, but also to hold ourselves accountable in our purchasing decisions.
  • Training and capacity building is a key component to the effectiveness of the Transparency in Supply Chain Act.
  • The Act will result in improving the dignity and human rights of workers globally.


[Note from the Ending Human Trafficking podcast team: This episode was recorded in 2011 so the contact information provided is no longer accurate. Please refer endinghumantrafficking.org/contact for the correct contact information to get in touch with the EHT podcast.]

Love the show? Consider supporting us on Patreon!


Dave [00:00:00] You’re listening to the Ending Human Trafficking podcast. This is episode number 17, recorded in November 2011. Welcome to the Ending Human Trafficking podcast. My name is Dave Stachowiak.

Sandie [00:00:28] And I’m Sandie Morgan.

Dave [00:00:30] And this is the show where we empower you to study the issues, be a voice, and make a difference in ending human trafficking. And Sandie, on our previous episode we had talked about the Solidarity Sleepout that the Live2Free organization at Vanguard University had sponsored, and I know that you have an update for us before we jump into today’s topic.

Sandie [00:00:55] Oh, my goodness, Dave, it was an amazing event because it was so high impact. And personally, I wanted to see lots of students experience what it’s like to sleep outside because you don’t have a place to go. And the weather was very reasonable because we’re here in Southern California. So we didn’t expect major hardships, but it was damp. And we had Rhonda Sortino come and tell her story when she was a child and homeless. And we had musicians come and we made PB and J sandwiches. PB and J, peanut butter and jelly. And we were kind of extra blessed because somebody brought in hot chocolate for us and we wrote some notes and put together some toiletry bags to distribute to homeless youth. And then we settled down for the night. As I crawled into my sleeping bag, I realized that wearing my sweats out on the damp lawn was not a good idea. The water on the lawn had whipped up the bottom of my pants, and so the bottom three inches were wet. And now I have the whole night to sleep in wet clothes because I don’t have anything else. I have no other clothes there. And I realized, you know, this is the reality way beyond I just have no other clothes for tonight, but maybe I don’t have any more clothes for tomorrow or the next day or so many other things. I just don’t have an option and I have to deal with it. During the night, many of the students who were getting cold because the dampness was literally landing on them found themselves getting up and trying to find a drier place. So when I got up in the morning, I found lots of the students against the walls, in the hallways, over on the cement, looking for a dry place. And all of a sudden, the pictures that you see of homeless people in shopping malls, in alleys and how they’re pushed up against a wall. You begin to understand why they ended up there. And beyond that, the bigger question of why are 200,000 California 11 to 17 year olds homeless right here in the United States?

Dave [00:03:24] And of course, the reason we’re talking about that on this podcast is, of course, we had talked about it a few episodes ago. But the bigger reason is because this is one of the contributing factors that unfortunately does lead to young people being part of that supply chain. So you need to, forgive the term, but to move into human trafficking and to be targets for people who would perpetrate this crime against them. And so it’s a really important thing for us to be aware of and to be able to put ourselves in the shoes of a person that may be in that situation so that we can better understand and then hopefully do something that will help advocate and be lights to people who are in that situation.

Sandie [00:04:14] Exactly. Because we sometimes judge those people. We judge those kids and say, what are they doing out here? When we’re not asking the right questions. And we want to address that when we have our conference in March.

Dave [00:04:27] So we’re going to talk more about the conference here in a little bit because we do have a conference coming up here in March. And so I’ll tell you more about the conference toward the end of the show here on some of the ways that, you know, one of the reasons that I’ve been involved with the Center, Sandie, is I believe strongly in the power of education. And I know you do as well being in the role you’re in at Vanguard and running the center and being a professor, that if we can open people up to a new way of thinking and provide them with the right tools and resources to understand and as we say, study the issues, that we then really empower people to go out into the world and to be strong advocates for change.

Sandie [00:05:12] Exactly.

Dave [00:05:13] And there are some changes coming to the state of California.

Sandie [00:05:16] Absolutely.

Dave [00:05:18] Even if you don’t live in California, I think this is a really important change to know about coming up that, you know, laws are starting to change in some of these areas. And January 1st, California has a new law coming. And so today, we’re going to be looking at this new law that California is starting January 1st and, Sandie, I know you’ve been kind of looking into this and researching this for quite some time. And so could you tell us first, what is the new law, what’s it called? And kind of frame what it’s trying to do.

Sandie [00:05:50] The California Transparency in Supply Chains Act was passed in 2010 and goes into effect January 1st, 2012. And in effect, it will require companies to disclose their efforts, if any, to ensure that their direct supply chains are free from slavery and human trafficking. Now, this really ups the game when we talked in the past about the law of supply and demand and fair trade and buying fair trade chocolate and slave free products. It’s a really difficult thing for the average consumer to figure that whole strategy out. And certificates and websites that try and help us identify fair trade products, slave free products, are helpful, but we need just a little bit more. It’s kind of like when you think about our law enforcement culture here in the United States. We have the coercive use of force so that everybody knows that if you break these rules, this is what’s going to happen. And we’re all pretty much programmed that way. In fact, when I see a black and white car in the lane next to me, my foot automatically eases off the gas pedal.

Dave [00:07:10] Me too.

Sandie [00:07:11] And I’m not even speeding. But I do that. So, for us to begin to have laws that reflect our values that we want to have slave free supply chains for everything that comes into our community, this is going to be helpful on the highway of international commerce.

Dave [00:07:36] So what does this law do? That sounds cool, but how does that all happen, Sandie?

Sandie [00:07:43] Well, it’s going to take some time for us to see what it looks like. But, SB 657, in case anybody wants to Google this, is really going to create a framework for transparency. And the idea, I think in a past podcast, we talked about just the idea of purchasing a pair of athletic shoes.

Dave [00:08:05] Mm hmm.

Sandie [00:08:05] It’s not simple to just say, well, it was made in America, so it must be fair trade. It must be slave free. You have to think about what are all of the pieces that are brought to the factory that are included in putting together that pair of athletic shoes? You’ve got cotton that may have been grown in Uzbekistan, where we know they have a big problem with child slavery. You may have metal that is from all kinds of different places and it may not always come from the same supplier. You may have polyester and rubber and all these things. So how do you document the supply chain before it got there? Because just because it was put together in the United States doesn’t ensure that it’s going to be slave free. And in fact, we have many cases of slave labor that’s actually going on here in America, as well. And that’s for another podcast to talk about some of those cases of labor trafficking in the United States. So what I kind of would like to do to get us into the ideas that are the foundation of the supply chain transparency philosophy is to look at a guide that was produced by the Interfaith Center on Corporate Responsibility. It’s a best practice guide called Effective Supply Chain Accountability, and we’ll put a link to this on the website, but I want to look at some of these suggestions here because it’s a really helpful thing for us, partly because when we are the consumer, if we’re knowledgeable about what kind of accountability the law is requiring, we can ask better questions when we’re filling out a suggestion form at a big department store. The idea of asking questions and making people accountable is really the basis for this act, and it will drive demand for better transparency and we will be able to have a better consumer experience from a social justice perspective.

Dave [00:10:32] And I know for me, Sandie, it does make a difference as far as just awareness level because I know I shop differently now, especially chocolate and coffee. I’m a lot more aware of that from some of our conversations we’ve had in the past, both on the show and offline, of what things to look for and what stores even to frequent. And that does make a difference when we know what’s going on. So it sounds like this law will help us to do that a little bit more effectively, if I’m hearing you.

Sandie [00:11:02] Well, and I think it gives us some really good tools for being responsible citizens. One of the other ways that people respond to the issues of products that are not slavery is they boycott those products. And that’s problematic on so many different levels because how do you know for sure which products are made with slave labor? How do you know if your boycotting is going to cost your neighbor his job here in the States? So it gets very complicated because everything is connected. When you think about like, Dave, you’re a businessman. What does the term globalization mean to you?

Dave [00:11:51] Reality is the first thing I think of when I think of globalization, but it also means a lot of complexity. And I think what you just said, Sandie, is really key for me when I think about some of these issues and I think about just clients we have and some of the products and services that they offer. You know, there’s so many different ways to look at situations when business is involved. And, you know, just one example off the top of my head is my father worked for the McDonald’s Corporation for 30 plus years. And so we know and love that organization very well. And that organization was wonderful to my dad and to our family over the years. And McDonald’s is an organization that, depending on what lens you look through, you can have very different opinions on it. McDonald’s is taking a lot of heat in the last few years for childhood obesity and they’ve been kind of the target. You know, they’re the biggest player in the fast food world. So–.

Sandie [00:12:51] French fries.

Dave [00:12:52] Yeah, french fries, I know. We all love the french fries, right. So, but they’ve taken some heat for that. And I think that, you know, to some extent, there’s, you know, for good reason. There’s some things that they’ve done that maybe they could have done a little differently. And then there’s also some things that they take some really unfair criticism for, too, around that. But a lot of people have a negative view of McDonald’s as a result of that. And then on the other side, McDonald’s does some amazing things. And one of them is Ronald McDonald Children’s Charities and the Ronald McDonald House of how McDonald’s for years has been an incredible supporter of that charity that, you know, was started by them and takes care of kids and families who are going through treatment in hospitals. And if you ever talk to someone who, I actually have a client right now who has a young one that is going through a very difficult time right after birth. And there’s some serious issues with the baby and they’ve been staying at the Ronald McDonald House. And it is people who have been in that facility and have been served by Ronald McDonald charities, you could not say anything bad about them. I mean, they think that they just walk on water, that it’s the best organization ever. And that they were that was an organization was willing to help them when they were in a very difficult time. And so this gets really complicated when you say you decide you want to boycott McDonalds over something, then you are also boycotting all the wonderful, you know, the great things they do in the world, too. And so when we talk about these large organizations and supply chains, this is really complex. It’s not just as simple as I don’t like this product and I’m going to boycott it. Well, like you said, Sandie. Your neighbor may work for that company, then they’re out of work. You know, maybe not directly because of your boycott. But if enough people do that and then how does that help out the world? So it’s really a complex, uh, it’s a complex web that we all live in today with globalization.

Sandie [00:14:55] That’s why I am so excited about this new transparency law. And let me kind of give you a little bit of an idea about what is going to happen with this. As of January 1st, 2012, companies will be required to make the disclosures available through, and I quote, conspicuous and easily understood link to the required information placed on the business home page, unquote. So here’s the information that must be included. They, number one, will verify supply chains to evaluate and address risks of human trafficking and slavery, including if the verification was conducted by a third party. Secondly, it will conduct unannounced and verified audits of suppliers for trafficking and slavery in supply chains to evaluate compliance with company standards. Thirdly, it will maintain internal accountability standards and procedures for employees or contractors failing to meet company standards regarding slavery and trafficking. Fourthly, to train employees and management with direct responsibility for supply chain management, to mitigate risks within the supply chains of products, and finally, certify that materials incorporated into the product comply with the laws regarding human trafficking of the country or countries in which they are doing business.

Dave [00:16:27] That’s a lot of changes, Sandie.

Sandie [00:16:29] It’s amazing.

Dave [00:16:30] Yeah. Yeah, it really is. You know, I think about, you know, organizations like Apple, which of course is based in California here, and just the amount of disclosure that, you know, an organization like Apple will need to do that they haven’t, you know, I don’t know how much they’re doing now specifically, but, you know, they have a huge supply chain all over the world. And there’s many organizations based in California that do. So, this is a big change.

Sandie [00:16:54] It’s huge. And we kind of need to begin to think about what we expect. Because as consumers, we vote at the cash register and our attitudes and our opinions count. So while the law does ask them to disclose, to be more transparent, it’s still going to fall to us to go to those home pages, read what they’re doing and say, Well, is that enough for me? Do I want to support that? And so understanding the elements, the key components of what I expect as a consumer with a sense of dignity and advocacy and responsibility for how I spend my resources, and because I understand that it’s the ripple effect. What I do at the cash register impacts people on another continent. So, I’m going to just look at just briefly a few of the key components that I expect when I go to their website. I expect to see a human rights policy. I want them to identify how they define slavery and what kind of human rights are valued by that company. Most will probably use the United Nations Declaration of Human Rights. I also want to see some evidence of due diligence. I want to know how they’re tracking. How are you going to show me that the chocolate on your shelves isn’t made by children who are slaves on the West Coast of Africa? And how am I going to know that if you say, well, we have slavery chocolate, and then I go to your store and I see, oh yes, up here in this high shelf that I can almost not reach, there is a brand with Fairtrade chocolate, but all of the cheap chocolate is at eye level and that isn’t slave free. And so how am I going to, and I hate to keep barking on, harping on the chocolate issue, but it’s just so simple. That’s why. And then because everything isn’t easy and black and white, I’m going to look for some kind of risk assessment tool that you’re using to evaluate human rights in. And Dave, you mentioned the situation that Apple received a lot of heat for some of their overseas factory practices, but other companies buy their components from the same factories. So risk assessment, verification and traceability is all part of that aspect of transparency. But I think a real key is training and capacity building. We can have the laws here, but if we don’t train the managers in those factories in those countries, then we probably are not going to see the kind of results that we want. So we hope that this new law will actually have a trickle down effect that doesn’t require global legislation, but depends on the very nature of the law of supply and demand. And the demand in California is for slave free products. So people who want to sell to the state, to any kind of consumer in the state of California, will need to put these kinds of training components into their practices or they just won’t even get to the table. So that’s going to take a lot of collaboration. And the result ultimately will be not just a better consumer experience. Guilt free for me and you. But it’s going to result in improving the dignity and the human rights of people in places we’ve never been.

Dave [00:21:01] So towards that end, Sandie, you mentioned some of the things that you’ll be looking for once this law is put into place. I would imagine companies are starting to think about this with the January 1st deadline looming. Are there organizations that are doing this voluntarily now and are there good examples that you could point us to of things that we could already be looking for as far as organizations doing this on their own?

Sandie [00:21:24] Well, I think that, yes, they are. I was interviewing the deputy district director of the Department of Labor here in Orange County a few months ago, and he immediately, off the top of his head, started naming the executives in big companies who now are the directors of supply chain verification. Big companies, Wal-Mart has someone, that’s their job. And it’s an area where the big corporations have seen this coming down the pike and they’re getting ready. They’re geared up. They have created the kinds of policies internally that will respond to this law.

Dave [00:22:10] Interesting.

Sandie [00:22:11] Some of them were already doing these things. Others are getting on board. I think what we’re going to begin to see is a good practice model and we’ll look for those who are doing a good job of that. One of them, Gap, has a code of vendor conduct and they’ve been doing that for a long time. They started that in 1996. Another one that I really loved, and I just kind of glance through some websites in preparation for this podcast. But I went to the Levi Strauss website and I saw one of their pages and it had three things to do for care of your new pair of jeans. And it had something to do with washing and all this. But number three, when you’re done, donate to Goodwill.

Dave [00:23:05] There’s a nice idea.

Sandie [00:23:06] You know, pass them on to someone else. So, I think that was a really good example of what we’re going to begin to see. We’re also going to begin to see more transparency on the shelves because cause related marketing is a sign of the times, because people are so much more aware about what human trafficking is. And, you know, I think in our next podcast, we’re going to talk about National Human Trafficking Awareness Day, and that’s going to drive more traffic to these kind of websites as well. So what does good practice look like? I think one of the questions that we’re going to begin to hear a lot will have to do with how do you do this and what is the best model? And human rights risk assessments are going to be key to that. We’ll be going to people like the International Labor Organization and we’ll go on our own Department of Labor. There is a link on the Department of Labor website for the United States government where they have a list of goods produced by child labor or forced labor. And they note the countries and the goods. They’re identified. That list is not as extensive as we are looking for in the future, but it’s going to grow. Very, very confident that it’s going to grow. Another good practice model that’s been cited is Hewlett Packard. It has a risk based four phase supplier management system that provides a framework for suppliers. And that’s really key because if people in those countries don’t know what you expect from them and you come in afterwards and tell them, Well, we can’t have this, we can’t have this, we can’t have this, it doesn’t really give them a chance to have fair access to our very large market that they desire so that they can increase and improve their own standard of living. So Hewlett-Packard has done a great job with developing those kinds of expectations. And by doing that, then they increase their level of influence in other places, not by heavy handed legislation, but just by using the law of supply and demand.

Dave [00:25:36] And we’ve talked before, Sandie, about how business has a great potential to influence the world substantially in positive ways that nonprofits and smaller organizations like ours, Sandie, wouldn’t have a chance to do as quickly or as meaningfully, I shouldn’t say as meaningfully, but as substantially in a short period of time as business does really have the ability to do that. I mean, you know, money talks and supply chains talk and consumers talk. So, if we can effect change there, then we can influence a lot of these positive changes to happen. And I know that sometimes people, when we talk about boycotts and things like that are always like, you know, business is bad and really it’s not. And most of us work for businesses. I work with a couple of businesses. And so it’s really looking at it through a different framework of how can business be partners in solving this issue. And there’s so many people that want to do that.

Sandie [00:26:37] And you bring up a really good point when you bring up nonprofits. And nonprofits have jumped in on the fair trade issue with both feet. But I was at an awareness event recently, and there was a nonprofit that had a table full of fair trade products to purchase, and they were all rather small sizes and very pricey because they had to tag on the expenses of running their nonprofit so they weren’t viable in the marketplace. And standing next to me as I’m looking through these products is a mom with four kids. And she says to me, she says, Can’t you do something so that they’ll have this at my supermarket? I can’t afford to feed my children these kind of pricey designer fair trade products. Well, what’s going to happen because of this transparency act is the social responsibility is going to get to the marketplace. It’s going to run in a business fashion that is profitable because that’s how business works. And they’re going to compete with everyday products so that this becomes part of your household budget. It won’t be something special that you have to go to another event to get it.

Dave [00:27:56] And it really, Sandie, it leads to what we’re trying to do, which is to create the education and the understanding and the opportunities to really move forward this conversation and to raise awareness, not because we like talking about all these tough issues necessarily, but because we want to do something about it. And speaking of doing something about it, we are going to have a great opportunity coming up here in early 2012 for the listeners of this podcast to get involved with doing something about your level of education, in your level of awareness of what you know about these issues. And I think this is a good opportunity for us to mention the conference you mentioned upfront that’s coming up. And the conference that the Global Center for Women and Justice is sponsoring is going to be coming up March 2nd and 3rd. We’ve mentioned those dates before on the podcast and now we have really the focus topic of what this conference is going to be about. And the title of the conference that’s just been announced is Standing Together to End the Exploitation of Girls. And so, Sandie, this is an important topic right now, and certainly it’s an important topic around human trafficking. And so the center is going to be hosting this conference and this is really a strategic plan to proclaim dignity, train advocates, and educate communities to respond to commercial sexual exploitation of girls and young women. So, the conference is going to bring together leaders from the front lines. We’ve talked about a lot in this podcast, Sandie, in communities across the country to learn about the experience and the expertize of actually some judges and a couple of them are Las Vegas Juvenile Justice William Voy and also Orange County Juvenile Justice, and I’m not sure I’m going to see his name right here, Sandie.

Sandie [00:29:50] Would you like me to do it?

Dave [00:29:51] Douglas–

Sandie [00:29:52] Hatchimonji.

Dave [00:29:54] Hatchimonji. Okay, great. And of course, law enforcement, doctors, nurses, social workers, educators, community fair leaders. We’re going to have a huge conference here this year. And that fact, this is going to be probably our biggest conference ever.

Sandie [00:30:08] Absolutely.

Dave [00:30:08] And it’s actually very inexpensive, reasonably compared to most conferences. You would go to that are day and a half conference to attend. It’s $99 to attend the entire conference and actually includes lunch on the Saturday. And so this is really a great opportunity if you’re someone that cares about this issue and really wants to educate yourself far beyond what we’ve been doing here on the podcast. I mean, we are really just scratching the surface of how much there is here. This is a tremendous opportunity to learn a lot, to do it in a fairly inexpensive way. You’re actually, you know, if you’re out of state you’re going to pay more to just get here then the conference is even going to cost. And of course, the great thing is it’s going to be early March and it’s Southern California. So the weather’s hopefully going to be pretty good, too.

Sandie [00:30:53] The weather’s free, you know.

Dave [00:30:54] Yeah, exactly. And what are we, 15 minutes at Vanguard University here from Disneyland and all those fun places and, you know, 10 minutes from the ocean and the beach. So, you know, you can be doing something great for the world, educating yourself, learning about these issues and also enjoying your time here and enjoying a little bit of vacation, too.

Sandie [00:31:15] And really, the frame for this conference is a healthy community. And when we look at community health and we see how homeless youth, how sexual exploitation, how human trafficking in our own communities impacts a healthy community, this means that anybody who is working as a teacher, a health care provider, a frontline service provider, if you are working with animals, it’s really absolutely. Someone tried to make a list of who should come to this conference. And I was really interested when I heard them brainstorming and they said, oh, we need to make sure we have mall security people come to this conference.

Dave [00:32:07] Yeah.

Sandie [00:32:08] And then somebody said, well–

Dave [00:32:09] They’re on the front lines.

Sandie [00:32:10] We need youth pastors to come to this conference. We need juvenile justice people to come to this conference. What I, ultimately, I finally quit making my list and we said, we need people who care about kids to come to this conference.

Dave [00:32:24] How do folks register Sandie if they–.

Sandie [00:32:26] Go to gcwj.vanguard.edu to register. You can also email us at gcwj@vanguard.edu. And if you have questions, you can call us at 714-556-3610, extension 2242.

Dave [00:32:48] And normally we have all that information up on the front of the show for your questions and comments, and we forgot to mention it up front, Sandie. So my apologies to all of you who have been listening, but if you do have questions and comments for us for what we’ve talked about today with the new law or anything around human trafficking, that we could be helpful to you and you want to send Sandie on a research trip. She’s always happy to do that. Send an email to us, gcwj@vanguard.edu or again the number 714-556-3610, extension 2242. And that’s going to do it for us today, Sandie. Thanks so much for your time and look forward to talking again here in a couple of weeks.

Sandie [00:33:29] Thank you, Dave. Bye bye.

Scroll to Top