Even though we are well into the 21st century, slavery is still a major problem. Some people might find that surprising given that slavery was supposedly abolished centuries ago. The sad truth is that modern slavery still exists, involving forced labour, forced marriage, human trafficking and other slavery-like practices.

Not only is it widespread but it is very profitable, to the tune of US$150 billion in profits annually, according to the International Labour Organisation (ILO).

“A staggering 40 million-plus men, women and children are reported to be enslaved. That’s one in 185 people. Women and children are disproportionately affected by modern slavery – accounting for 71 percent of the overall total. One in four victims of modern slavery are children, or about 10 million children globally,” says Bettina Reinboth, head of social issues, Principles for Responsible Investment (PRI), in a blog article on the PRI’s website.

The Asia-Pacific might be considered one of the world’s most booming regions in terms of economic prosperity and growth, but it is also where the highest number of modern slaves are found with almost 25 million or 62% of the global total, according to the 2018 Global Slavery Index.

Modern slavery isn’t just limited to certain regions, but a global problem that is present in many industries. These include agriculture and construction, which often rely on third-party labour recruiters to bring in workers from overseas, as well as fishing or apparel manufacturing.

The global financial system is not exempt either. In fact, modern slavery is linked to the financial system in several ways.

According to Reinboth, “Traffickers often use cash-intensive businesses, informal banking systems or shell companies to launder funds. However, they may also try to launder profits illicitly generated from these crimes into the formal sector.”

To address this, the Financial Sector Commission on Modern Slavery and Human Trafficking, known as the Liechtenstein Initiative, was established in September 2018. Chaired by the PRI CEO Fiona Reynolds, and convened by the foreign affairs ministries of Liechtenstein, the Netherlands, and Australia, this is a public-private partnership made up of 25 commissioners. These include survivors of human trafficking and child slavery, leaders from hedge funds, banks, institutional investors, regulators, and other leaders.

The commission has held a series of four consultations on different issues such as the financial sector’s approach to anti-slavery compliance and anti-money laundering, responsible investment, partnerships, and how financial sector innovation could be used to tackle root causes.

The commission will release its full findings from these consultations in September 2019, as well as provide recommendations of concrete actions to further financial sector engagement on the problems of modern slavery and human trafficking.

“If the finance sector plays a key role in tackling these crimes, undoubtedly, we can make a real measurable impact towards achieving the goals set by the UN Security Council and the G20 and end modern slavery. Wouldn’t that be a much better news headline?” says Reinboth.