THE Church of Scotland has been urged to use the financial power of its investments to help eliminate child labour and exploitation in global supply chains.
Human rights activist Fernando Morales-de la Cruz has written to senior church officials urging the Church of Scotland Investors Trust (COSIT) – which manages approximately £500 million in investments – to use shareholder engagement and investment decisions to put pressure on companies.
The Modern Slavery Act 2015 currently mandates that large commercial firms in the UK publish an annual statement outlining the actions they have taken to prevent human trafficking and modern slavery in their supply chains.
But campaigners have hit out at the lack of current safeguards, with the Office of the U.S. Trade Representative (USTR) also coming to the same conclusion in a recent report.
With this in mind, Morales-de la Cruz has argued that the Church of Scotland should go beyond ethical purchasing and start using its financial influence to demand measurable action from companies.
The child labour expert suggested that this could also be achieved through COSIT’s wider membership of the Church Investors Group (CIG), an ecumenical network of faith-based investment bodies in the UK and Europe that has considerable collective financial power.
“I am not asking the church to make symbolic statements. I am asking whether it is using its financial power to produce measurable change,” he told The National.
“If the church genuinely believes that every child has inherent dignity and rights, then its investment power should be used to help ensure that corporations respect those rights.”
His letter, addressed to Val Brown, convener of the Church of Scotland’s ethical oversight committee, and John Millar, the chair of COSIT, also challenged the church’s promotion of Fairtrade.
Morales-de la Cruz’s letter questioned whether Fairtrade certification alone is sufficient to tackle poverty and child labour when certification does not necessarily guarantee that farmers receive a living income or that children are protected from exploitation.
“If growers are not receiving a fair and sustainable share of the value created by the products they produce, then the system is not fair to them,” he said. The National understands that the church is in the process of trying to set up a meeting with Morales-de la Cruz.
“Child labour and exploitation is a blight on the world’s conscience. We take seriously our Christian responsibility to wisely steward the resources at our disposal to challenge the systems and supply chains that allow such practices to persist," John Millar, chair of the Church of Scotland Investors Trust, said.
“The Church of Scotland Investors Trust doesn’t actively manage our funds. Instead it employs professional third-party managers to act on our behalf in a way that is consistent with our Christian faith.”
He added: “Working with partners as part of the Church Investors Group (CIG), we have recently reviewed our guidelines for fund managers to tackle child labour and modern slavery by advocating for transparency and ethical standards in global labour practices and supply chains.
“Our managers are constantly reporting back with evidence on how our existing holdings are performing against these values, and how they are engaging to improve things. Should a company we hold stock in fall short of upholding people’s God-given dignity and worth, we would divest.
“Child labour is not a static problem, so neither are we. We are constantly checking ourselves and working with partners to ensure we are playing our part in tackling this insidious practice.”
On the topic of Fairtrade, a Church of Scotland spokesperson said: “We have always campaigned against systematic injustices in trade and tax, both locally and globally. We have been on the frontline calling for the cancellation of unpayable debt. We know that systemic injustice disproportionately affects the lives of the poorest and most vulnerable, both here in Scotland and across the world.
“There is no doubt that some large companies can use fair trade in a tokenistic way by using it in one small corner of their broader global operations. However, we have supported fair trade from its inception.”
They added: “Supporting fair wages and better living conditions for some of the world’s poorest communities – all of which are needed to gain the fair trade mark – is something we firmly support.”
