MODERN SLAVERY STATEMENT 2022
Kentucky Fried Chicken (Great Britain) Limited Modern Slavery Statement 2022.
Introduction from Meghan Farren – KFC UK&I Managing Director
KFC takes a zero-tolerance approach to any form of slavery forced labour and human trafficking. This is KFC’s Modern Slavery Statement for 2022 issued in accordance with the Modern Slavery Act 2015.
2022 has been a year that has been marked with stress and turmoil for many, with ongoing conflicts in Ukraine and the natural disasters we have seen across the globe. This has caused a large amount of uncertainty and economic pressures across the food industry. We know that these added strains leave individuals in a vulnerable position and increase the risk of exploitation of people across the food supply chain, a risk we take seriously!
KFC have over 1000 restaurants and 36,000 colleagues across UK&I and we wish to ensure that we retain the core values set out by our founder Colonel Harland Sanders for our KFC family and those within our supply chain. Through these unprecedented times, our focus on our values and people culture has been critical, ensuring our teams are looked after, our franchise partners are supported, and that we have been actively working with our supply chain to mitigate any challenges.
The statement below sets out the steps we took throughout 2022 and continue to take as a business to meet the commitments we have made to promoting human rights and the prevention of modern slavery.
In 2022, we developed and launched a new training model to increase awareness and knowledge of Modern Slavery, Human Trafficking training, Child Criminal Exploitation and Child Sexual Exploitation. This training was developed in conjunction with Stop The Traffik. This included training on child criminal exploitation and child sexual exploitation. To date, 100% of our United Kingdom and Ireland employees have completed the e-learning training.
In addition, we continue to build on our work from 2021 on improved transparency and risk mapping of our supply chains and across more industries. We have conducted interviews and engagement sessions with our major suppliers around the Sourcing Code of Practice, which included exchanges around human rights risk and mitigation, and re-emphasizing the importance of the SEDEX registration.
In 2023 we plan to continue with the progress made in 2022 by expanding our training modules to additional colleagues and expanding the risk mapping and transparency across the supply chain.
Introduction
This statement sets out the steps taken by Kentucky Fried Chicken (Great Britain) Limited and other relevant group companies (“KFC” or “we”) for the financial year commencing 27 December 2021 and ending 25 December 2022 to prevent modern slavery and human trafficking in its business and supply chains.
Our previous Modern Slavery Statements can be found here: 2021 Statement; 2020 Statement; 2019 Statement; 2018/17 Statement; 2016/17 Statement.
Our Organisation and Our Business
KFC was introduced to Britain in 1965 when our first restaurant opened in Preston. There are now over 1,000 KFC restaurants in the UK and Ireland and around 37,000 team members in our business. There are over 26,000 KFC restaurants in more than 145 countries and territories around the world, including in Africa, Asia and Oceania, South America and the Caribbean, Europe, the Middle East and North America. KFC is operated on a part equity, part franchised model and as of December 2022, 99% of KFC restaurants across the world are franchise operated.
KFC is part of Yum! Brands, Inc. (“Yum! Brands”) which is based in Louisville, Kentucky. Yum! Brands and its subsidiaries or franchisees operate a system of over 55,000 restaurants in more than 155 countries and territories under the company’s concepts – KFC, Taco Bell, Pizza Hut and The Habit Burger Grill. In 2022, the company was named to the Dow Jones Sustainability Index North America for its commitment to citizenship and sustainability across its restaurant business. Yum!’s Global Citizenship & Sustainability Strategy, called its Recipe for Good, is the company’s roadmap for social responsibility, risk management and sustainable stewardship of its people, food and planet.
We understand that modern slavery - whether slavery, servitude, forced or compulsory labour or human trafficking - is a continual and growing global issue that can be found especially in the agri-food sector in which we operate. At KFC, we have a zero-tolerance policy on modern slavery and human trafficking of any kind within our business and our supply chain. We have a responsibility to minimise any risk of this kind in any part of our business operations and in the event of an incident, we will address this promptly with all relevant parties concerned.
1. OUR SUPPLY CHAIN
We are committed to conducting our business with the highest degree of integrity. We seek to assure the quality of our products and the wellbeing of the people working in our restaurants and supply chain by maintaining a close stable relationship with our franchisees and our direct suppliers, managing performance and the continuous improvement of quality, service, cost, innovation and risk management.
Direct suppliers mean suppliers of goods that are core to our business, namely food, drink and packaging.
While we are confident that our internal centralised human resources processes for recruitment minimise the risk of modern slavery or human trafficking taking place within KFC itself, our supply chain relies on our suppliers’ good ethical business practices. Open communication with our direct suppliers is critical for identifying and resolving any supply chain issues so that together we can respond rapidly and fully to ethical issues.
We have processes for the sourcing and management of our suppliers in order to minimise risk to our brand, the environment and the communities that our restaurants and supply chains impact. Further details of what these processes include can be found in the due diligence section of this document.
We carefully select our direct suppliers, developing long-term relationships with them that give us the confidence that a global brand like KFC demands in its supply chain. We are aware that parts of our supply chain are predominately resourced with a seasonal, low-paid, unskilled workforce and that these industries can be at risk from the exploitation of workers and modern slavery. Whilst we are confident that our sourcing practices minimise this risk, particularly in relation to our direct suppliers, we know that risk can only be reduced if we are continually vigilant and demanding on our supply chain.
Our Policies
One of the ways we address modern slavery risks in our supply chains is through our Sourcing Code of Practice (the “Sourcing Code”), which incorporates the Yum! Supplier Code of Conduct and is governed by the KFC Western Europe Ethical Sourcing Policy, the Sustainable Sourcing Policy, the Farm Animal Welfare Policy, and the Product Integrity Policy. The Sourcing Code sets out defined ethical standards we require suppliers to follow as part of their agreement to supply KFC. It requires all suppliers to uphold internationally agreed standards of labour, comply with national laws, and work to continually improve workplace and employment standards. All our direct suppliers are required to comply with the Sourcing Code.
In 2022, we reviewed the above policies and updated the Sourcing Code. Regularly reviewing our policies (e.g. the Sourcing Code bi-annually) enables us to address any growing risk areas (e.g. this year we identified some risks around Soy so introduced our first Sustainable Sourcing Policy for Soy) and ensure our policies are robust and mitigate risk of modern slavery.
Labour Standards
Our labour standards are set out in our Western Europe Ethical Sourcing Policy, which is reviewed and updated where needed by the KFC Western Europe Head of Responsible Sourcing & Regulatory Compliance. The Western Europe Ethical Sourcing Policy was last reviewed in November 2022. If a supplier is found to be in breach of these policies an investigation and appropriate corrective action will be taken. We are proud to say that there were no reports of suppliers being in breach of the Ethical Sourcing Policy in 2022.
We require our suppliers to provide employment that is freely chosen, ensure that there is no forced or bonded labour and have in place policies, systems, risk assessment, training, and measurements to ensure no forced labour or slavery exists. We also require that our suppliers allow employees the freedom to associate, organise and join a trade union (or collective bargaining group acting for them) in a lawful and peaceful manner without penalty or interference. Suppliers are required to treat all workers with dignity and respect, and never allow or condone any actions such as abuse or harassment. Suppliers are also required to comply with all applicable wage and hour laws and regulations.
Further, we support the Ethical Trading Initiative (ETI) Base Code of Conduct, which sets out the labour standards we expect our suppliers to meet. We do this through our work with SEDEX. SEDEX leverages the Ethical Trading Initiative Base Code to assess risk at each supplier site, across four main areas — labour standards, health and safety, business ethics and environment. It uses a combination of inherent industry and country-related risk factors, self-assessments, and third-party, ethical audits to determine both potential and actual exposure. Gaining this additional visibility further strengthens our confidence in our supply chain.
Due Diligence, Risk Assessment and Management
We recognise the importance of being fully aware of the ethical practices and any associated risks in our supply chain.
As part of their contract with KFC, direct suppliers are expected to establish management systems for delivering compliance to KFC policies and to maintain records demonstrating this. Suppliers must take appropriate steps to ensure that:
- The Sourcing Code is communicated to all relevant employees.
- There is regular engagement with relevant management teams about the need for compliance.
- Appropriate training on the Sourcing Code is provided to key employees.
- Processes and systems are in place to provide means for workers to report or discuss non-compliance confidentially.
KFC expects any non-compliance to the Sourcing Code to be reported by our supplier so that we can work together to create a time-measured plan to correct the situation as quickly as possible.
In addition, our direct suppliers are required to register with SEDEX, an ethical data exchange that ensures that ethical standards are monitored and measured. All direct suppliers are required to complete a risk assessment, including a Self-Assessment Questionnaire and undertake independent third-party audits when required. This provides KFC with an overview of the level of risk posed by each supplier and allows us to focus on the areas of greatest risk.
In any instances where we feel there is an unacceptable risk, we will contact our suppliers in writing, reminding them of our values and ethical standards and reiterating the expectations we have when working with them. We contractually reserve the right to audit our direct suppliers if the need arises.
2. OUR OPERATIONS
We recognise that team members working for both KFC UK headquarters, KFC-owned restaurants and franchisee-owned restaurants must be treated fairly and with respect. We ensure that we comply with all applicable wages, benefits and hour laws and regulations, and our franchisees are contractually obliged to do the same. We pay fair wages in line with the norms for the industry and market, do not require anyone to work excessive hours and overtime is voluntary.
Our Internal Policies
We know that our employees are crucial to helping ensure that modern slavery is removed from our operations and supply chain. We have the following policies that support our statement and position on modern slavery and human trafficking:
- Business Conduct Ethics Policy
- Employee Code of Conduct
- Grievance Policy
- Equal Opportunities Policy
- Whistleblowing Policy (which is included in our Equal Opportunities Policy) - our employees have a duty to report any ethical concerns so that we can take steps to stop it from happening. We know that this can be personally challenging, so we have provided and publicised a completely confidential helpline called “Speak Up” to encourage our employees to whistle blow in safety. Employees are giving training on Speak Up and there are posters in Team areas in restaurants with information on the service.
Training
KFC has an annual compliance training programme in relation to our policies. We are proud of our training standards, and we continue to assess our compliance training programme to see where we can make further improvements.
An assessment of our training programme in 2021 showed the need to expand our training modules to include modern slavery and sexual exploitation training to all 36,000 of our in-restaurant colleagues. In 2022, KFC developed a new mandatory training series with STOP THE TRAFFIK containing modules on modern slavery, human trafficking and child criminal exploitation and child sexual exploitation. We included training on child criminal exploitation and child sexual exploitation because of the demographics and age of our workforce. This training programme was rolled out to team members, team leaders, assistant restaurant managers and restaurant general managers across our KFC corporate and franchise business. We are working to ensure that all levels across the business and our franchise network complete this training, with the programme being launched to above restaurant level employees in May 2023.
Achievements in 2022
To measure our effectiveness and progress on the issues of modern slavery and human trafficking, we have created Key Performance Indicators (KPIs), and have reported on our progress on each of our KPIs as set out below:
| Risk Area | Mitigations and KPIs | Progress in 2021 | ||
|---|---|---|---|---|
| Supply Chain |
|
| ||
| Awareness | We will review and assess our training programme | In 2021, we identified the need for Modern Slavery and Human Trafficking training. In 2022, we developed a training programme to address this which included e-learning modules on Child Criminal Exploitation and Child Sexual Exploitation. This training was rolled out to all employees in restaurants (including all Team Members, Team Leaders, ARGM’s and RGM’s). The training is delivered through e-learning courses and induction programmes for new employees. To date, 100% of our United Kingdom and Ireland active employees have completed the e-learning training. | ||
| Employees | We will review some of our employment contracts to ensure they are meeting industry standards and upholding the rights of employees. KFC Reward Council – in 2021, we pledged to launch the KFC Reward Council which oversees the visibility and parity of rewards across our business, both within franchisees and direct employees. | The KFC Reward Council was launched in H1 2022 and is attended by franchise owners, senior operators and HR employees. Since the Reward Council has been established, it has carried out the following work:
|
Next steps
In the next 12 months, we will continue to strengthen our approach to managing the risk of modern slavery within our business and supply chain. Our targets for 2023 are set out below:
- Supply chain risk assessment – we will continue our work to ensure that 100% of KFC’s existing and new suppliers have an up-to-date risk score. We will use the results of the SEDEX Self-Assessment Questionnaire to map our suppliers and determine our next steps in terms of mitigating human rights risks across our supply chain. We will continue our work with STOP THE TRAFFIK.
- Supply chain due diligence – we will continue our work to ensure that 100% of KFC’s direct suppliers are required to be registered with SEDEX. We will do so by working with SEDEX over a 6-month period to identify suppliers which are not yet registered and communicate directly with them on the importance of registration. We will also develop our use of the platform to increase the transparency of information we have on suppliers.
- Training - we will extend the mandatory training programmes which were launched on modern slavery, child sexual exploitation and human trafficking to our above restaurant staff in our Restaurant Support Centre.
- Employees – we will launch a working group focussed on mitigating the risks of Modern Slavery across our business.
This statement has been approved by the board of directors of Kentucky Fried Chicken (Great Britain) Limited.
Meghan Farren
Director, Kentucky Fried Chicken (Great Britain) Limited
22 December 2023