New report shows companies failing to act on modern slavery

A coalition of human rights organisations and academics, including Associate Professor Vikram Bhakoo from the Faculty of Business and Economics, University of Melbourne, is calling on the Federal Government to overhaul Australia's modern slavery laws.

A major investigation has found companies are still failing to identify obvious modern slavery risks in their supply chains or take action to address them, despite operating under laws designed to limit use of slavery for two years.

The report, Broken Promises: Two years of corporate reporting under Australia’s Modern Slavery Act, examines the second year of corporate statements submitted to the Government's Modern Slavery Register by 92 companies sourcing from four sectors with known risks of modern slavery. They are garments from China, rubber gloves from Malaysia, seafood from Thailand and fresh produce from Australia.

A/Prof Vikram BhakooAssociate Professor Vikram Bhakoo, one of the report's authors and an expert in supply chain management, said the Federal Government needs to introduce tougher laws for reporting and mitigating modern slavery risks.

A/Prof Vikram Bhakoo Associate Professor Vikram Bhakoo was one of the authors of the report.

“Disclosure-based legislation is simply not working in this space. Allowing companies to self-report has become a box-ticking exercise for them. With two thirds of companies failing to comply with reporting, it means we do not know the extent of slave labour being used in their supply chains,” said Associate Professor Bhakoo.

He said the laws need  a comprehensive overhaul when they come under review in March 2023.

“At the end of the day this is about people and human rights. Consumers in Australia do not want to be using goods or services in which slave labour was used somewhere in the supply change. Due diligence is now critical for companies sourcing labour overseas,” he said.

The report found that:

  • 66% of companies reviewed are still failing to comply with the basic reporting requirements mandated by the legislation, with some companies not submitting reports at all;
  • 56% of the commitments made by companies in the first year of reporting to improve their modern slavery response remained unfulfilled based on their second year statements;
  • 43% of companies reviewed are still failing to identify obvious modern slavery risks in their supply chains;
  • There is a 6% increase in the number of companies taking some form of effective action to address modern slavery risks, with two in three companies still failing to act.

The authors are calling on the Government to act urgently to strengthen the legislation by:

  • Requiring companies to undertake due diligence to prevent and address modern slavery in their operations and supply chains;
  • Introducing penalties for companies that fail to comply with the Act;
  • Ensuring appropriate oversight and enforcement of the Act by appointing an Independent Anti-Slavery Commissioner.

Read the full report.