The Foreign Affairs and Aid Sub-Committee of the Parliament’s Joint Standing Committee on Foreign Affairs, Defence and Trade has tabled the final report for the Committee’s inquiry into establishing a Modern Slavery Act in Australia (see related article for background).
The Committee made 49 recommendations in its final report, Hidden in Plain Sight. In essence, it recommended that the Australian Government introduce a Modern Slavery Act in Australia which should include, among other things, a mandatory supply chain reporting requirement. It’s recommendations in relation to the reporting requirement include:
Threshold: the total revenue threshold for the mandatory supply chain reporting requirement should be set at $50 million to capture most large entities operating in Australia. It noted that this would be consistent with the UK’s threshold of £36 million.
Reporting areas: taking into consideration the suggested areas outlined in the UK Modern Slavery Act, the reporting areas should be as follows:
- the organisation’s structure, its business and its supply chains;
- its policies in relation to modern slavery;
- its due diligence and remediation processes in relation to modern slavery in its business and supply chains;
- the parts of its business and supply chains where there is a risk of modern slavery taking place, and the steps it has taken to assess and manage that risk;
- its effectiveness in ensuring that modern slavery is not taking place in its business or supply chains, measured against such performance indicators as it considers appropriate;
- the training about modern slavery available to its management and staff; and
- any other actions taken.
Timing: annual modern slavery statements should be provided within five months after the end of the Australian financial year.
Compliance: there should be penalties and compliance measures for entities that fail to report, applying to the second year of reporting onwards.
The Committee’s recommendations in relation to the supply chain reporting requirement include some marked differences to the Australian Government’s proposed model which was outlined in the consultation paper released in August 2017. The Government’s proposed model included that the revenue threshold for the reporting requirement be set no lower than $100 million total annual revenue, and did not propose penalties for non-compliance.
The Australian Government will consider the Committee’s report and all feedback provided during the consultation process, and will refine and finalise the propose model for a modern slavery in supply chains reporting requirement. The Minister for Justice proposes to seek to bring forward draft legislation in the first half of 2018.
There is opportunity for further advocacy in this space. If it is an area of interest to your business, please contact AMMA Policy Advisor, Ingrid Fraser, at [email protected] for further information.