The UK government has made economic growth its defining mission. The growth strategy is explicit: stability, investment, reform, and productivity are the foundations upon which prosperity will be built. Against this backdrop, there is an urgent question that deserves serious attention from policymakers and business leaders alike: Does the UK’s approach to supply chain integrity support or undermine this growth agenda?
I would argue that without mandatory human rights due diligence (MHRDD) and forced labour import bans, the UK is pursuing growth with one hand while tolerating a significant structural drag on the economy with the other.
The economic case is clear
Let me start with the fundamentals. Modern slavery costs the UK an estimated £60 billion socio-economically each year – roughly 2% of GDP. That translates to an average cost of £92.8 million per English constituency, £67.8 million in Wales, £65 million in Scotland, and £62.3 million in Northern Ireland. This is not a marginal issue. It is a material economic problem that compounds year on year.
The UK currently imports approximately £20 billion worth of goods annually that carry significant risk of forced labour in their production. Without enforceable standards, responsible UK businesses are systematically undercut by competitors willing to tolerate – or wilfully ignore – exploitation in their supply chains. This is not a level playing field. It is a race to the bottom that penalises ethical conduct and rewards opacity.
The economic logic is straightforward. When the EU’s Corporate Sustainability Due Diligence Directive and forced labour import ban take full effect in 2027, goods excluded from European markets will seek alternative destinations. While the revision negotiations are in flux, it appears the Directive will remain in one form or another. Without equivalent UK standards, Britain risks becoming what parliamentary committees have termed a “dumping ground” for products that fail to meet international norms. The competitive disadvantage this creates for responsible UK businesses is obvious.
Investment follows certainty, not chaos
There is a legitimate concern, particularly from business representative bodies, about regulatory burden. Let me address this directly, because the evidence points in a different direction than the instinctive pushback might suggest.
First, on costs. The EU Commission’s impact assessment for the CSDDD estimates average compliance costs at approximately 0.13% of companies’ annual shareholder payouts. For context, this is not a transformational burden – it is a manageable operational adjustment. More comprehensive analysis from the ILO indicates that globally, the investment required to implement targeted forced labour interventions amounts to roughly 0.14% of GDP, while the economic returns from ending forced labour would generate a demand-driven GDP increase of 0.41% – nearly a 3:1 return on investment. The question is not whether businesses can afford due diligence. It is whether they can afford not to undertake it.
Second, on certainty. The current UK landscape is fragmented. NHS procurement has one set of requirements. Great British Energy has another. Various sector-specific initiatives operate in parallel, with no coherent framework tying them together. For businesses operating across multiple sectors or engaging with different public bodies, this creates genuine complexity and duplication. A single, clear, UK-wide MHRDD standard would reduce this regulatory patchwork, not expand it.
Investors representing $5 trillion in assets have explicitly called mandatory due diligence essential for economic productivity and better-run companies. Their reasoning is pragmatic: companies that understand their supply chains, mitigate human rights risks, and operate transparently are more resilient, face fewer reputational crises, and attract capital more effectively. Fifty UK businesses and investors have signed statements calling for MHRDD legislation, precisely because voluntary approaches have failed to create competitive parity.
From a capital allocation perspective, this matters. In an environment where ESG considerations increasingly influence investment decisions, regulatory clarity reduces risk. Ambiguity does not.
Productivity gains from responsible business conduct
There is a deeper economic argument here that deserves attention. The government’s growth strategy depends on productivity improvements. Yet productivity is not simply a function of capital investment or technological advancement. It is also shaped by workforce stability, supply chain resilience, and the quality of business relationships.
Evidence from multiple sectors demonstrates that companies respecting workers’ rights experience measurably lower turnover rates, higher productivity, and better product quality. In the apparel industry, for example, factories with strong labour standards retain workers longer, meaning training investments yield returns and production quality improves. In extractives, poor community engagement leads to operational stoppages, with opportunity costs that dwarf the investment required for meaningful stakeholder consultation.
Supply chain resilience has become a strategic priority for businesses operating in an era of geopolitical volatility and climate disruption. Companies with transactional, low-trust supplier relationships absorb shocks less effectively than those that have built robust, long-term partnerships grounded in mutual respect and shared standards. During the COVID-19 pandemic, brands that maintained support for suppliers rather than abandoning them were able to resume operations more quickly. This is not abstract. It is the difference between supply chains that function under pressure and those that fracture.
The false economy of inaction
Opposition to mandatory due diligence ultimately rests on an implicit argument: that UK growth depends on tolerating worker exploitation somewhere in the supply chain. I do not believe this is a credible or defensible economic proposition.
The costs of inaction compound. Reputational crises, when supply chain abuses are exposed, generate losses that are difficult to quantify but substantial – senior management time diverted to crisis response, damaged brand equity, loss of investor confidence, and erosion of social licence to operate. Legal liability is increasing, as courts in France, the Netherlands, and other jurisdictions issue significant rulings on corporate responsibility for value chain impacts.
More fundamentally, competing on the basis of low standards is a strategy with diminishing returns. As international norms converge around mandatory due diligence – through the EU, growing US state-level legislation, and emerging frameworks in Asia – UK businesses exporting to these markets must already meet these standards. Domestic misalignment creates compliance complexity without competitive advantage.
The alternative is clear. Compete on innovation, quality, and integrity. Build supply chains that are transparent, resilient, and capable of withstanding scrutiny. Attract investment from capital providers who increasingly factor governance and human rights performance into their allocation decisions.
A proportionate, pro-growth framework
What does effective MHRDD legislation look like? The model being developed by Unseen, the Independent Anti-Slavery Commissioner, Omnia LLP, and Forward Global offers a practical template.
It targets large organisations and the commercial operations of public bodies, minimising burden on SMEs. It establishes a statutory due diligence defence: businesses that take reasonable and proportionate steps to prevent harm are protected from liability. Proportionality is explicit, reflecting company size, sector, and risk exposure. Many businesses are already putting these processes in place, and one benefit of our model will be to add clarity in terms of what is “enough”, i.e. reasonable/proportionate.
This is not a tick-box compliance exercise. It is a framework that incentivises meaningful risk management while providing legal clarity. It focuses on outcomes – preventing harm, ensuring remediation where harm occurs – rather than prescribing rigid processes that may not fit diverse business contexts.
Critically, it aligns with international standards, including the UN Guiding Principles on Business and Human Rights and OECD Guidelines. For UK businesses already navigating these frameworks in international markets, domestic alignment simplifies rather than complicates compliance.
Who benefits?
The beneficiaries of this approach are multiple and overlapping.
Businesses gain competitive protection from rivals profiting from exploitation, clearer regulatory expectations, access to capital from investors prioritising responsible conduct, and reduced reputational risk from supply chain controversies.
Workers - in UK supply chains and globally – gain tangible protections, access to remedy when harms occur, and a framework that shifts incentives towards decent work rather than coercion.
Government benefits from alignment between its growth mission and its stated values, increased tax revenues from a more productive and resilient economy, reduced public spending on the social costs of exploitation, and enhanced UK credibility in international forums where these standards are being negotiated.
Consumers gain assurance that the products they purchase are not tainted by forced labour, and the ability to make informed choices backed by credible corporate disclosure.
Investors benefit from reduced portfolio risk, better data on corporate human rights performance, and confidence that UK regulatory frameworks support long-term value creation rather than short-term arbitrage.
This is not a zero-sum proposition. It is a structural reform that aligns incentives across stakeholders.
Moving beyond the false binary
There is a tendency in these debates to frame the choice as regulation versus competitiveness, as if these are inherently opposed. The evidence suggests otherwise.
The UK lags every other G7 country on business investment as a share of the economy. Low investment has driven low productivity and stagnant growth. Breaking this cycle requires creating the conditions for long-term, strategic investment – and that includes regulatory frameworks that support rather than undermine business integrity.
Countries and regions implementing MHRDD are not doing so because they are indifferent to growth. They are doing so because they recognise that sustainable growth requires more than GDP figures on a spreadsheet. It requires trust, legitimacy, and resilience in the economic system itself.
The International Court of Justice’s recent advisory opinion on climate change makes clear that states have obligations to regulate private sector activities that cause significant harm, and that due diligence is central to meeting these obligations. The direction of travel internationally is unambiguous. The question for the UK is whether to lead, follow, or risk being left behind.
The path forward
I have spent decades working across jurisdictions to design and implement interventions against modern slavery. I have seen what works and what fails. Voluntary approaches, in the absence of legal drivers, do not create the systemic change required. They allow leaders to advance while laggards free ride. They concentrate responsibility among a committed minority rather than distributing it across the economy.
Legislation creates the foundation for change at scale. It shifts the calculus for businesses from “should we invest in this?” to “how do we implement this effectively?” It enables collaboration, because companies can engage in collective action without fear of competitive disadvantage. It provides leverage for responsible businesses to demand better standards from suppliers, knowing that competitors face the same expectations.
The government has an opportunity to align its growth mission with its commitment to responsible business conduct. MHRDD and forced labour import bans are not obstacles to growth. They are preconditions for growth that is sustainable, inclusive, and credible.
This is not about imposing costs on business. It is about ensuring that the costs of exploitation – currently borne by workers, communities, and responsible businesses – are internalised by those who profit from it. It is about levelling the playing field so that UK businesses compete on the basis of excellence, not on who can best obscure their supply chain risks.
The economic case is clear. The evidence is robust. The beneficiaries are many. The time to act is now.
Background: This article draws on research from the Council of Europe’s report on Human Rights and Competitiveness, the ILO‘s assessment of investment requirements and economic benefits of ending forced labour, and ongoing policy development by Unseen, the Independent Anti-Slavery Commissioner, Omnia LLP and Forward Global.