Australia's response to modern slavery continues to develop; is your organisation ready?

Modern slavery is an umbrella term that encompasses a range of illegal and unethical workplace practices that exploit people for personal or commercial gain. Modern slavery can occur in every industry and in every sector. However, identifying and preventing modern slavery occurring within business operations and supply chains is not straightforward.

Understanding industry trends and strategies to prevent modern slavery can inform your organisation’s pathway forward as you progress along the journey of identifying and addressing modern slavery risk. 

What are businesses doing to address modern slavery?

Since the introduction of the Modern Slavery Act 2018, over 4,500 mandatory statements have been published. Statements to date have come under heavy scrutiny with 77% of assessed companies failing to address all mandatory reporting criteria (AHRI, 2022),  52% of assessed companies failing to identify and disclose salient modern slavery risks (AHRI, 2022), and reports indicating a “race to the middle” rather than the race to the top (ACSI, 2021). 

The Paper Promises report, released by the Human Rights Law Centre in February this year, highlighted that the majority of companies have poor engagement beyond tier one suppliers and a failure to demonstrate how known sector-specific risks (e.g. horticulture sector in Australia) relate to their operations. Additional findings include gaps in disclosure of responsible purchasing practices, human rights due diligence, remediation processes and engagement with vulnerable groups. 

In the 2021-22 financial year, the Australian Federal Police received an increase in modern slavery and human trafficking reports, up to 294 from 224 in the previous financial year. The five most reported crimes were:

• 84 reports of forced marriage,
• 54 reports of sexual servitude and exploitation,
• 42 reports of forced labour,
• 37 reports of exit trafficking in persons,
• 21 reports of trafficking in children 

What to expect next, and how can Deloitte help you?

Addressing modern slavery is both a regulatory obligation and a moral one. Modern slavery awareness is steadily growing, and it is no longer acceptable for businesses to ignore human rights abuses from which they may indirectly benefit.

Modern slavery reporting in Australia is expected to evolve. The newly elected Australian Labor Government (ALP) has announced commitments to:

• Appoint an independent Anti-slavery Commissioner who will work with business and government to ensure compliance and improve transparency of supply chains;
• Publish an annual list of countries, regions, products, industries that are at high risk of modern slavery;
• Require relevant companies connected with this list to prove that their products are not made with forced labour; 
• Introduce penalties for non-compliance; 
• Specify significant issues of concern (e.g., Uyghur forced labour) that companies will mandatorily be required to report against; and
• Consider introducing targeted sanctions for foreign companies, officials and other entities known to be directly profiting from forced labour or other human rights abuses. 

As of 1 July 2022, organisations have entered the third modern slavery reporting cycle. Deloitte has the experience and expertise to uplift your organisation's capability in addressing modern slavery. 

Deloitte can help your organisation: 

• Increase visibility beyond tier one suppliers;
• Integrate human rights due diligence across operations and supply chains; 
• Strengthen stakeholder engagement and facilitate social dialogue;
• Identify key risks in your supply chain, particularly relating to high-risk sectors and geographies; 
• Implement effective remediation processes; and 
• Develop an evolving roadmap for your modern slavery mitigation activities to help you communicate continuous improvement. 

As reporting requirements and community expectations evolve, Deloitte can help you ensure your organisation is confident as it progresses along its journey in mitigating modern slavery and building a better world where everyone has the right to be free.