Tag Archives: due diligence

Summarised: Review of the Modern Slavery Act 2018

Addressing modern slavery requires more than criminalising the illegal control of or mistreatment of individuals. It necessitates a comprehensive response to the various forms of modern slavery, including human trafficking, servitude, worker exploitation, child labour, forced marriage, debt bondage, and deceptive recruitment.

Australia has recognised this challenge  and has implemented a range of laws, programs, networks, and support services to tackle it head-on. One key component of Australia’s response is the Modern Slavery Act 2018, which focuses on transparency reporting. This legislation mandates large businesses and entities operating in Australia to submit an annual statement to the government, outlining the actions they are taking to address modern slavery risks within their domestic and global operations and supply chains.

To promote transparency and accountability, these statements are made available to the public through the Modern Slavery Statements Register. As of early 2023, the Register has published over 7,000 statements from nearly 8,000 entities headquartered in more than 50 countries. This government-run register is the first of its kind internationally and has already garnered significant attention.

In accordance with the Modern Slavery Act, a review was initiated three years after its commencement, starting on March 31, 2022. The review aimed to assess the effectiveness of the Act in combating modern slavery and explore potential improvements to its framework and administration. It also sought to evaluate whether the law was being taken seriously and effectively implemented. Below you can find a summary of the review and recommendations, as well as the full list of recommendations made.

Continue reading Summarised: Review of the Modern Slavery Act 2018

New Research: Is the Australian Modern Slavery Act Fit For Purpose?

The Australian Modern Slavery Act 2018 (MSA) aims to combat modern slavery in the operations and supply chains of Australian businesses by requiring them to report on their efforts to address this issue. However, the question remains whether the Act is fit for purpose. This new report, based on data collected from a business survey and focus groups conducted in 2022 and 2023, offers new insights to inform policy change and business practices by examining the gaps between policy and practice in corporate modern slavery statements.

Effectiveness and barriers

Our investigation gathered input from respondents regarding the MSA’s effectiveness, best practices for implementing remediation measures, and potential reforms. The report presents evidence of corporate responses triggered by the MSA and stakeholders’ perceptions of its impact. Findings reveal a broad consensus that the current corporate responses to the Australian MSA are generally not benefiting victim-survivors of modern slavery. While the MSA raises awareness in the best case, it may also provide a superficial appearance of compliance for businesses that continue to depend on opaque supply chains and cheap labor without substantive commitment to addressing abuses.

Two critical issues highlighted by survey and focus group participants for improving policy and practices to address modern slavery are enhancing supplier relationships and stakeholder engagement. Respondents identified several barriers to effective remediation, including current procurement practices, low trust between suppliers and reporting entities, and inadequate resourcing by businesses for remediation efforts that would compensate and empower victim-survivors of modern slavery. Remediation is a crucial aspect of addressing modern slavery, and effective processes must prioritise risk to people over risk to business.

Remediation and potential reform

The findings also offer insights into practices that may contribute to more effective remediation of modern slavery, providing valuable lessons for government policy focus and businesses seeking to improve their approach to remedy. Survey data indicates that participants who engage key stakeholders in remediation, such as trade unions, report the most effective approaches. Other essential tools include risk management practices like supplier training and increased transparency from suppliers—practices currently utilised by Australian businesses.

Data from this report and previous research demonstrate a strong desire for MSA reform and the need to incentivise improved practices. A majority of survey respondents:

  • Endorse establishing an Anti-Slavery Commissioner;
  • Support harmonising the MSA with international standards, such as the UN Guiding Principles on Business and Human Rights (UNGPs), and emerging legislation in other countries;
  • Agree that mandating human rights due diligence requirements would lead to improved responses to addressing modern slavery;
  • Support a mix of policy measures, including sanctions and incentives (such as disqualification from government tenders, financial penalties, and director liability) to better tackle modern slavery.

There is a clear disconnect between policy and implementation when it comes to addressing modern slavery within the operations and supply chains of Australian businesses. This stems from a lack of transparency in corporate supply chains, which hinders both the detection and resolution of modern slavery issues. To effectively combat this, it is essential to prioritize enhancing supplier relationships and collaborating with key stakeholders such as trade unions. The problem can only be resolved if it is first acknowledged and understood. Gaining better insight into labor conditions in supply chains through engagement with frontline workers is a fundamental and indispensable initial measure in the battle against modern slavery.

All respondents advocated for reform of the MSA to drive company action that benefits victim-survivors of modern slavery, rather than merely promoting superficial compliance with the Act. This report, therefore, serves as a call to action for both policymakers and businesses to work together to enhance the effectiveness of the MSA and genuinely address the issue of modern slavery in corporate supply chains.

Human Rights Due Diligence: An Overview

The purpose of this resource is to offer a comprehensive overview of global human rights due diligence legislation, including both proposed and enacted laws. Initially created for the Australian Cotton Industry, this document is also valuable for policymakers, industry professionals, civil society, and scholars interested in understanding trends in human rights due diligence, comparing legislation across countries, and estimating anticipated changes for businesses operating in Australia.

The Growing Focus on Mandatory Due Diligence

Over the past few decades, there has been heightened scrutiny on the societal impacts of businesses. International organizations have developed non-binding guidelines and recommendations since the 1970s, acknowledging companies’ responsibility to uphold human rights and implement due diligence across supply chains. However, these voluntary international agreements have fallen short in effectively safeguarding human rights within commercial supply chains. Consequently, governments have experienced increasing pressure to incorporate these guidelines into domestic legislation.

In recent years, there has been a notable increase in country-level due diligence legislation, inspired by guidelines from international organizations. Examples of such legislation include the California Transparency in Supply Chains Act 2010, the UK Modern Slavery Act 2015, the French Corporate Duty of Vigilance Law 2017, and the Australian Modern Slavery Act 2018. Our analysis highlights the rapid development of due diligence legislation, with numerous drafts currently under parliamentary discussion. Critics have voiced concerns regarding the nature of these reforms, citing lenient penalties, weak requirements, and a limited scope of businesses affected. Despite these criticisms, the growing prevalence of domestic due diligence legislation demonstrates its potential to pave the way for significant change.

Key trends in human rights due diligence legislation:

  1. Increasing robustness: New legally binding regulatory frameworks are becoming increasingly more robust, with the expectation that mandatory due diligence across supply chains will be the end result.
  2. Expanding expectations: There is a growing expectation for small and medium-sized businesses to incorporate aspects of due diligence, as seen in the Aotearoa New Zealand proposal and Canadian Modern Slavery Act.
  3. Industry-specific legislation: Laws targeting specific industries have emerged, such as the New York Fashion Act and the US FABRIC Act.
  4. Broadening scope : Some proposals extend the scope of workplace violations to include worker exploitation, as in the Aotearoa New Zealand proposal.
  5. Legal redress for victims: Certain laws provide opportunities for victims to seek legal redress, as in the Dutch Child Labor Law.
  6. Increased fines and penalties: Some acts impose higher fines and penalties, such as the US Uyghur Forced Labor Act and the German Act on Corporate Due Diligence.

These trends indicate a global shift towards stronger and more comprehensive human rights due diligence legislation, emphasising the importance of businesses in upholding human rights and promoting sustainability across their supply chains.

Strategies for Improving Labour Conditions within the Australian Cotton Value Chain

The Cotton Research and Development Corporation (CRDC) commissioned research to better understand labour issues along the Australian cotton value chain and to recommend strategies for the industry to explore.

Labour conditions for workers in textile and garment value chains remains an area of continuous concern. While Australian cotton enjoys a reputation as a clean, green crop grown under decent working conditions, once the cotton enters global value chains, all visibility is lost, and sustainable value is diminished. Actors throughout the chain, from brands and retailers to manufacturers, to non-governmental organisations, are working tirelessly to address working conditions in a boundary-less system with fragmented governance. Can fibre producers also play a role?

This animation provides an overview the seven solution approaches that were developed as part of a collaborative project between the Queensland University of Technology, the University of Technology Sydney, and the University of Notre Dame Australia.

The project team members: Alice Payne, Erin O’Brien, Rowena Maguire and Justine Coneybeer (Queensland University of Technology), Timo Rissanen and Karina Kallio (University of Technology Sydney), Martijn Boersma (University of Notre Dame Australia).

The various outputs developed as part of the project can be found here.

What can Australian Cotton Farmers do to Protect Garment Workers?

Ten years ago, the garment industry’s worst industrial accident – the Rana Plaza collapse in Dhaka, Bangladesh – killed more than 1,100 workers and highlighted the travesty of conditions for millions of garment workers globally.

It spurred action to address exploitation, but for many workers little has changed.

Just in the past few months, Britain’s Tesco supermarket chain has been accused of profiting from the “effective forced labour” of workers in Thailand (making Tesco-brand jeans), while the world’s biggest clothing retailer, China’s fast-fashion brand Shein, has been exposed for rampant human rights abuses.

Such incidents are meant to have been eliminated, as big brands are supposed to leverage their power to effect change in global supply chains. Australia’s Modern Slavery Act, for example, requires companies with more than A$100 million in annual revenue to publicly report on their efforts to ensure their supply chains are free of labour exploitation.

The expectation has been that pressure from consumers and investors will be enough for retailers (who profit the most from driving down production costs) to drive change. Campaigners for better conditions say these requirements are all too often a “fig leaf”, because audits can easily be fudged.

Limited attention has been given to what suppliers can do to ensure their products aren’t associated with exploitation.

Continue reading What can Australian Cotton Farmers do to Protect Garment Workers?

From Local to Global: Best Practice in Fighting Modern Slavery

If people are serious about ending modern-day slavery, consumers need to be prepared to pay more and companies must be prepared for a drop in profits, while governments must pass unpopular legislation, a professor of law at the Catholic University of America has warned.

Professor Mary Graw Leary is a founding director of the Bakhita Initiative for the study and disruption of modern-day slavery.

In her address to The Tablet webinar, “From local to global: best practice in fighting modern slavery and human trafficking”, sponsored by the University of Notre Dame Australia, she acknowledged that “great strides” have been made in fighting modern slavery and human trafficking in a fairly short period of time.

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Forced Organ Transplants: A Business and Human Rights Issue

In November I was part of a panel of experts that discussed forced organ transplants in the context of medical ethics, business and human rights implications, modern slavery obligations for Australian businesses, the United Nations’ human rights treaties and mechanisms, and Australia’s responsibility to protect and promote human rights.

Footage of this event held at New South Wales Parliament House can be found below. The section on Business and Human Rights starts at 55:00.

Submission to the Inquiry into the NSW Modern Slavery Act 2018

The Standing Committee on Social Issues is inquiring into and reporting on the Modern Slavery Act 2018 (NSW) (the NSW Act), the consultation draft of the Modern Slavery Bill 2019 (the amendment Bill), and the consultation draft of the Modern Slavery Regulation 2019 (NSW) (the Regulation), with particular reference to:

  • (a) the operability of the proposed anti-slavery scheme
  • (b) the effect of the anti-slavery scheme on business, including the supply chain reporting obligations under section 24 of the NSW Act
  • (c) the intended application of the anti-slavery scheme with respect to charities and not-forprofit organisations, State Owned Corporations and local councils
  • (d) the appropriateness and enforceability of Modern Slavery Risk Orders under section 29 of the NSW Act
  • (e) the unintended consequences of drafting issues with the NSW Act, including with respect to the Human Tissue Act 1983 (NSW) and the sale and supply of human tissue
  • (f) the risk of a possible constitutional challenge to current provisions in the NSW Act due to inconsistencies with the Criminal Code Act 1995 (Cth)
  • (g) whether the passage of the Modern Slavery Act 2018 (Cth) renders parts or all of the NSW Act unnecessary, or requiring of amendment to address inconsistencies or gaps
  • (h) the preferred course of action to address the matters identified
  • (i) any other related matter.

Below is the submission made by Justine Nolan and Martijn Boersma.

What Gives Multistakeholder Initiatives Legitimacy?

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Multistakeholder initiatives are often heralded as a solution to many social and environmental issues. Yet, due to their composition, these initiatives are not without tensions and challenges. This paper examines which factors determine the (il)legitimacy of multistakeholder initiatives in the context of efforts to remediate child labor.

Abstract

Child labor in global supply chains is increasingly addressed through multistakeholder initiatives. However, the participation of stakeholders with distinct views and interests can generate tensions. Based on interviews with civil society actors, this research finds that tensions exist between the normative‐ethical and political‐strategic dimensions of multistakeholder initiatives, which are manifest in the existence of international and national norms and their contextual application, in definitions of child labor, risk and responsibility, and in doubts about corporate incentives to join multistakeholder initiatives. In addition, tensions exist concerning the effectiveness of supply chain auditing, enabling broader labor rights as a means to remediate child labor, and whether standards need to be mandatory or self‐regulation suffices. The success of collaboration depends on the effective navigation of these tensions. Failure to do so can undermine the legitimacy of multistakeholder initiatives from the perspective of civil society actors. The research finds that due diligence, in the shape of human rights risk assessments, is not subject to normative‐ethical/political‐strategic tensions, and can play a key role in the success of multistakeholder initiatives and the fight against child labor.

Download the full paper.

Changing Approaches to Child Labour in Global Supply Chains

My latest research finds that effective approaches to child labour in global supply chains are characterised by companies engaging with a broad range of stakeholders, taking a contextual and holistic approach by considering local circumstances and broader human rights, and by focusing on prevention and remediation. By shifting from code of conduct and auditing based approaches towards stakeholder collaboration and due diligence, companies are moving away from reactive and paternalistic approaches to child labour and instead increasingly adopt proactive and pluralistic strategies. The influence of the UNGPs has the potential to ameliorate some the tensions in multi-stakeholder partnerships by requiring companies to be first movers and using this advantage to include stakeholders rather than exclude them in developing CSR strategies. While these developments can help to elevate child labourers from latent and discretionary stakeholders to expectant and dependent stakeholders, they continue to rely on CSOs to add weight to their claims.