Determinants of corporate compliance with modern slavery reporting

Abstract

Purpose

This paper aims to investigate the determinants of corporate compliance with the transparency in supply chains provision of the UK Modern Slavery Act. While recent scholarship has described what firms are doing to comply with this Act, no attempt has been made to explain their behaviour.

Design/methodology/approach

A predictive model of corporate compliance with modern slavery reporting is tested using secondary data from Financial Times Stock Exchange 350 firms. The model is informed by institutional theory and, in particular, by Oliver’s (1991) insights into the conditions under, which firms respond to institutional pressures.

Findings

Compliance with modern slavery reporting is found to be significantly related to firm size, prior social responsibility commitment, network involvement, industry and headquarter base (UK versus non-UK). Other predictors such as media exposure, shareholder concentration and profitability are found to be non-significant.

Research limitations/implications

The focus is on the 350 largest publicly listed companies in the UK. The stances that firms outside of this cohort are taking on modern slavery reporting still need to be investigated.

Practical implications

Compliance with the UK Modern Slavery Act varies by industry. Regulators should consider this as a part of risk profiling strategies and follow-up inspection of firms.

Originality/value

This paper provides the first theoretically grounded examination of the organisational and environmental factors that determine corporate compliance with modern slavery reporting.

Citation

Flynn, A. (2020), "Determinants of corporate compliance with modern slavery reporting", Supply Chain Management, Vol. 25 No. 1, pp. 1-16. https://doi.org/10.1108/SCM-10-2018-0369