Building a Stronger Response to Modern Slavery
Key Recommendations from the Modern Slavery Act Review
The completion and presentation of the statutory review of the Modern Slavery Act (the Act) on 25 May 2023 marked a significant milestone. Enacted on 1 January 2019, the Act holds a prominent place in our collective memory. We recall the celebrations shared with our colleagues, as a sense of immense relief that washed over us. Years of campaigning had finally yielded results, igniting hope and optimism for a future where companies, governments, and society at large would confront the exploitation and slavery deeply rooted within our global supply chains.
Undoubtedly, the Act has transformed the landscape of modern slavery in Australia, propelling it from a fringe issue to one that demands serious attention from businesses and government bodies. Professor John McMillan, the author of the Modern Slavery Act Review Report (the Review), acknowledges the high level of commitment and enthusiasm displayed by all sectors throughout the consultation process.
Yet, a critical question remains: Has the Modern Slavery Act truly provided the necessary protection for those vulnerable to modern slavery? The Review humbly concedes that concrete evidence demonstrating meaningful change for individuals living in conditions of modern slavery remains limited. Perhaps it was overly ambitious to place such expectations on an Act primarily designed as a transparency reporting law.
The Review presents 30 recommendations for the Government’s consideration and adoption. Here are some key recommendations that could enhance the Act’s effectiveness in combatting modern slavery:
1. Establishment of an Anti-Slavery Commissioner: The government’s commitment to establishing this office, as evident from the allocation of funding in the last Federal budget, is widely anticipated. The Review emphasises the importance of a high-profile appointment to the role, ensuring national leadership in raising awareness and endowing the Commissioner with broad powers to monitor Act compliance. Notably, the Review suggests that the Commissioner (or the Minister overseeing the Act) issue written declarations identifying regions, locations, industries, products, suppliers, or supply chains deemed to carry a high risk of modern slavery. This step could significantly reduce the resources and costs currently expended on risk assessments. It is worth mentioning that the United States already publishes such a list, a measure Be Slavery Free has long advocated for. However, we must remain vigilant, as the effectiveness of the office hinges on accountability and sustained public scrutiny.
2. Adoption of a Due Diligence Approach: Moving away from the current approach that primarily focuses on reporting and describing modern slavery risks and actions taken to address them, the Review recommends ‘a duty to prevent’ be required of entities to take effective action to identify and assess risk, and track performance in addressing them. This shift aligns with the evolving trend observed in the European Union legislation.
3. Widening the Scope of Reporting Entities: The Review proposes reducing the revenue threshold for mandatory reporting under the Act from $100 million to $50 million, thereby encompassing an additional 2,400 entities.
4. Introduction of Penalties for Non-compliance: The initial three years of the Act have revealed varying levels of quality in Modern Slavery Statements (MSS). Implementing significant penalties and enforcing stricter minimum reporting guidelines can streamline the process for companies, improve compliance, and enhance the overall quality of reporting.
5. A Complaints’ Procedure: This is proposed for the public and civil society to call out entities who are not adequately addressing the requirements of the Act.
What can your business do to prepare?
We strongly encourage you to familiarise yourself and your staff with these recommendations. Even if not all 30 recommendations are adopted or implemented simultaneously, they signal a growing trend towards more stringent obligations. Globally, the due diligence approach is gaining momentum in addressing modern slavery. The Review provides a helpful appendix (Appendix E) outlining comparative international developments. A mere tick-box exercise for MSS will likely fall short of future reporting requirements.
Join our webinar on 22 June, featuring an expert panel comprising of a human rights lawyer (Irene Crowther), a professor of accounting (Prof John Dumay), a globally recognised sustainability manager (Dr Darian McBain), and our own directors (Fuzz and Carolyn Kitto). Gain valuable insights and perspectives on how your organisation can proactively prepare for legislative changes and effectively combat modern slavery within your supply chains.
