Proposed supply chain legislation to address modern slavery is commendable, but needs further refinement

SYDNEY, 18 AUGUST 2017: Though the federal Government should be commended for its proposed legislation that will make it a requirement for large businesses to report annually on their actions to address modern slavery, as announced this week, UNICEF Australia has concerns about the currently proposed model, said CEO, Tony Stuart.
 
“The federal Government is correct to conclude that business as usual is not acceptable and that direct regulation is necessary, given the compelling evidence presented to the Parliamentary Committee conducting the Inquiry into a modern slavery act,” Mr Stuart said. “The introduction of a supply chain reporting requirement for large businesses would undoubtedly be a step in the right direction, and will help elevate the risks of these human rights abuses to Board level, where attention and awareness is needed.”
 
However, Mr Stuart said UNICEF Australia had identified three main areas in which the proposed model could be significantly strengthened to improve its effectiveness and achieve better outcomes. He said:
 
UNICEF Australia is concerned, firstly, about suggestions that the reporting requirement may not apply to Commonwealth or state and territory procurement. This would result in missed leadership opportunities for the government to set the example and to reward only leading businesses with taxpayer’s money. 

The threshold for the requirements, to only apply to businesses with $100 million total revenue and over, is unaccountably high – it is also inconsistent with the UK model and could unnecessarily limit its reach and benefit. 

The requirements need to be backed up by a compliance mechanism, including penalties, because without consequences for failure to comply, the reality is there will be little incentive for businesses to do so. 

Supply chain regulation is an opportunity for the government to deliver on Australia’s commitments under the Sustainable Development Goals. In UNICEF Australia’s view, the minimum reporting requirement should capture and address the worst forms of child labour in supply chains.
 
UNICEF Australia believes Australia should move to a model that includes a human rights due diligence requirement in law. This would see meaningful action taken by the largest businesses to identify risks to human rights, and to prevent and mitigate them, thereby working to protect children and adults in their supply chains.
 
“Our starting point should be the protection of child and adult victims of slavery and other forms of exploitation,” Mr Stuart said. “We know businesses can play a powerful role in working to prevent such exploitation from happening in their supply chains, so this proposed regulatory model, with some practical refinements, represents an excellent opportunity for effectiveness and best practice.”
 
Mr Stuart said UNICEF Australia commends the ongoing inquiry of the Joint Standing Committee on Foreign Affairs, Defence and Trade, which has considered the issue of supply chain regulation at length. At the same time, UNICEF encourages the Government to develop a model of supply chain regulation that takes full account of the Committee’s recommendations, along with the evidence it has garnered from the community.
 
Media inquiries:
Brinsley Marlay, UNICEF Australia
0420 407 886
bmarlay@unicef.org.au

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