Directors of Australian entities with revenues of over $100m, have principal responsibility for disclosing in annual statements potential modern slavery risks in their supply chain and be confident of genuine progress towards the elimination of slavery under the Modern Slavery Act 2018.
The Australian Council of Superannuation Investors has identified potential impacts for non-compliance of modern slavery reporting obligations on company’s reputation, operational disruptions, divert of resources and costly legal consequences.
Companies need to establish a specific process to dig deeper than the first layer of suppliers and maximise the understanding of risks. Some of the most common mistakes made include assuming that Australian or local suppliers are without risk, that assessing direct suppliers is enough or that existing procedures will uncover instances of exploitation. Many companies are working to embed practices that address risks of exploitation, bribery, corruption and worker safety. Others are collaborating within their sectors, building awareness in their organisations, developing stronger relationships with suppliers and strengthening ethical sourcing programs with strict internal frameworks, contract review and auditing.
Boards are encouraged to ensure that thorough consultation across the business is undertaken and that modern slavery statements and their aspirations are realistic and capture mandatory criteria.
As sustainability specialists, Cress Consulting is ideally positioned to assist you in identifying the risk of modern slavery occurring in your business and set out steps to address that risk. If you’d like to find out more please contact us here.