Federal Government Proposes Modern Slavery In Supply Chains Reporting Requirement
Monday 21 August 2017 @ 11.37 a.m. | Corporate & Regulatory
Minister for Justice Michael Keenan has announced that the Federal Government is proposing to introduce legislation for businesses to report annually on steps they have taken to address modern slavery within their supply chains. The Federal Government has released a discussion paper outlining their proposed legislative model and it will be open for public comment until 20 October 2017. The discussion paper says that the Minister for Justice hopes to review this feedback before bringing forward the draft legislation in the first half of 2018.
In a media release, the Minister for Justice said:
“I am pleased to announce that the Government proposes to introduce legislation that will make it a requirement for large businesses to report annually on their actions to address modern slavery…
The proposed reporting requirement will ensure large businesses and other entities operating in Australia publish annual statements outlining their actions to address this crime.
It will support the business community to respond more effectively to modern slavery, raise business awareness of the issue and create a level playing field for business to share information about what they are doing to eliminate modern slavery.
Importantly, it will also encourage business to use their market influence to improve workplace standards and practices.”
Proposed Model
The discussion paper outlines three possible options – doing nothing, taking non-regulatory action and taking targeted regulatory action. The Federal Government has decided that ‘targeted regulatory action’ is their preferred option:
"We believe this is on balance the best and most effective way for us to equip and enable the business community to respond effectively to modern slavery and develop and maintain responsible and transparent supply chains. We also believe that the cost of regulating is in proportion to the real-world risk. Modern slavery involves grave abuses of human rights and serous criminal misconduct and it is appropriate that Government takes regulatory action to support the business community to combat this issue."
The new reporting requirement will be contained in a new Act of Parliament. Entities that are covered by the requirement will be required to publish annual “Modern Slavery Statements” within five months after the end of the financial year. The Government suggests the report should cover similar criteria to the model currently used in the UK:
- The entity’s structure, its operations and its supply chains
- The modern slavery risks present in the entity’s operations and supply chains
- The entity’s policies and process to address modern slavery in its operations and supply chains and their effectiveness (such as codes of conduct, supplier contract terms and training for staff), and
- The entity’s due diligence processes relating to modern slavery in its operations and supply chains and their effectiveness.
The Government is proposing that entities are required to publish these Statements on their webpages and in a free, publicly accessible central repository provided by the Government.
The Government is not planning to introduce any punitive penalties for non-compliance.
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