Existing non-traditional, non-financial risk:

Social Environmental Financial.

6 phases

Cardel to cradle

Law, convention, ethics. Stakeholder

1) Forced Labor:

Human Rights Watch’s research found that migrant workers who voluntarily enter
employment aboard Thai fishing vessels often cannot leave because boat owners, skippers,
and brokers hold them in forced labor. They may work alongside individuals who secured
their jobs through similar channels but who are not victims of forced labor, or alongside
individuals who can be considered trafficking victims as a result of the way they were
recruited.

2) Human Trafficking:

Prompted in part by numerous media exposés that raised serious concerns about killings,
beatings, and trafficking of migrant fishers, many from Burma and Cambodia, the European
Commission in April 2015 issued a “yellow card” warning to Thailand, identifying it as a
possible non-cooperating country in fighting illegal, unreported, and unregulated (IUU)
fishing. A subsequent “red card” would lead to European Union sanctions.

3) Unfair Salary Payment System:

Lump sum payment systems play a major role in controlling migrant fishers, forcing them to
remain with employers who subject them to unfair terms of employment and substandard
working conditions, and trapping them on boats in situations of debt bondage and forced
labor. Fishers who try to flee face the loss of earnings owed to them, usually six or more
months’ worth of salary; the loss of legal status; and possible intimidation and violence by
vessel owners, skippers, and brokers claiming that the fisher still owes them “debts.”

Source reference: Hidden Chains Rights Abuses and Forced Labor in Thailand’s Fishing
Industry from Human Rights Watch

Solutions:

1. Increase Transparency and Document the Entire Supply Chain:

The company has to document the supply chain. It's not enough to know who's supplying
the company with a product or component. It also need to know who's supplying them,
ideally at least two levels up the chain.

2. Assess the Risk of Forced Labor:

Forced labor is most common in South Asia, China and Central Africa. Since FFC is located in
Thailand, there is a high likelihood of forced labor in the company’s chain. Therefore, the
company should do careful inspection to assess the risk of forced labor.

3. The company should tighten up its contracts:

If there's risk, amend contract with the suppliers to let them bear the large financial
penalties in case they fail to disclose suppliers or use suppliers who are discovered to be
using forced labor.

4. Audit the supply chain:

If at all possible, make a personal inspection of the supply chain or hire a specialist to do so.
By doing this, we can investigate whether an unfair salary payment system exists in the
supply chain. It's much wiser to flush out the problems by the company itself than do
damage control after it has become public knowledge.

5. Be Ready to Replace Existing Suppliers:

If the company discovers or suspects forced labor existing in the supply chain, find another
source for its product. Yes, this might well increase the cost of goods. But it's worth it in the
long run.

Source reference: How to Avoid Forced Labor In Your Supply Chain from Inc.com

Existing non-financial and non-traditional problem

1)Slavery
There are poor working conditions, recruitment processes, terms of employment, and
industry practices in Thailand that put already vulnerable migrant workers into abusive
situations.
Due to the shortcomings in Thai law and the operational practice of frontline agencies that
allow victims of forced labor to fall through gaps in existing prevention and protection
frameworks. For example, in an official report from 2015, the Thai government noted that
inspections of 474,334 fishery workers had failed, astonishingly, to identify a single case of
forced labor.
Source: Human Right Watch

2)Trafficking and violence on fishing boats and at onshore processing facilities

Fish caught by victims of trafficking working aboard Thai fishing boats were being used to
feed shrimp grown and exported for sale in the freezers of the world’s top four retailers. As
reported by different medias, there are raised serious concerns about killings, beatings, and
trafficking of migrant fishers, many from Burma and Cambodia. Migrant fishers are beat by
others.
Source: Human Right Watch

3)Illegal fishing
There is serious problem of illegal fishing in Thailand, many boats without a fishing licenses
are catching a vast amount of fish, which is a heavy destruction to the ecosystem and unfair
to those licensed fishers.
Source:
Source: The diplomat
Recommendation
1) Enhancing internal audit
We should increase the frequency and intensity of physical inspections of processing
facilities, because this is the most direct way to see how the workers are treated in the
facilities.

2) Set out clear expectations to the manager, and measure what you expect
Maybe they have their own way of operating the facilities, but since we are going to invest
in the company so they should respect our requests. It is important to let them know the
importance of labor right, we ca nset up clear guidance to them. Adopting robust policies
that include respect for human rights and labor standards.

3) Tap into the experience and knowledge of workers on the ground using ubiquitous mobile
technology
We can interview workers outside the factory where they are less likely to face retribution,
providing greater opportunities for workers to provide feedback anonymous. In this way, we
can collect the sincere opinions.

4) Understand the whole recruitment process

We have to know the source of the workers, where do they from, are they legal to work
locally. After that, we need to examine our existing employment contract, is the salary and
working hours make sense, is it a living wage or a minimum wage.

5) Hold community event to raise the awareness of citizens on human trafficking and illegal
fishing
I think it is possible to set up a channel to let citizens communicate with the us and report to
us when they see any suspicious activities. In order to promote that, we have to hold some
community events to build our relationship with customers.
6. join in partnership with NGO to bring in passionate talent and expertise, also increase
integriaty.

7. Initiate programs with clients to clean up the industry.

Mutual benefitable, resources, brand image, move from 6phase compliance to efficiency.