The construction industry has been labelled at risk of slavery in supply chains in a federal government discussion paper that proposes mandatory reporting on modern slavery risks for companies with annual revenue of over $100 million.
The Modern Slavery in Supply Chains – Reporting Requirement discussion paper said the construction industry was a key sector of concern in terms of the presence of slavery in the supply chain, along with agriculture, electronics, fashion, hospitality and extractives.
In the US, the government has identified 139 goods from 75 countries that it believes have been produced using child or forced labour, including bricks, footwear, textiles and gold. In Australia, victims of modern slavery have also been found in the domestic construction sector.
Federal justice minister Michael Keenan said the proposed reporting requirements would compel large businesses and other entities operating in Australia to publish annual statements outlining efforts to address the crime of modern slavery.
“It will support the business community to respond more effectively to modern slavery, raise business awareness of the issue and create a level playing field for business to share information about what they are doing to eliminate modern slavery,” Mr Keenan said.
“Importantly, it will also encourage business to use their market influence to improve workplace standards and practices.”
Mr Keenan said investors, civil society, large businesses and peak bodies have already shown support for action on the issue through the Parliamentary Joint Committee on Foreign Affairs, Defence and Trade inquiry into establishing a Modern Slavery Act in Australia.
The sub-committee is investigating whether elements of the UK Modern Slavery Act 2015 could be introduced in Australia, particularly the UK requirement for businesses and organisations to report on how they ensure their global supply chains are free of slavery and human trafficking.
Sub-committee chair and federal member for Dunkley Chris Crewther welcomed the announcement.
“I am proud that the Coalition government has today announced its intention to legislate for a supply chain reporting requirement for large businesses, a central repository for statements, and launching a national consultation process,” Mr Crewther said.
“This consultation, in conjunction with the inquiry I am chairing, will help determine the final content of the proposed legislation to combat modern slavery, something which should no longer exist in today’s world.”
A major recommendation of an interim report released this month was the development of legislation requiring businesses, companies, organisations and governments operating in Australia to report on measures taken to address modern slavery in their global supply chains.
Government excludes its own procurement from requirements
The government discussion paper, however, proposed excluding its own procurement from reporting requirements.
The inquiry received 201 submissions, including submissions from ANZ Bank, NAB, Westpac, EY, LexisNexis, Forest Stewardship Council, the Supply Chain Sustainability School and Global Reporting Initiative.
JLL also made a submission, supporting the enactment of an Australian Modern Slavery Act, and supporting corporate reporting.
“JLL believes there is a strong business case for transparency on non-financial matters. Our clients and investors demand greater clarity and accountability before doing business with us. Large companies such as JLL wield substantial power to influence change within supply chain networks by driving up standards and removing the profitability of modern slavery.”
It said that some of the suppliers from which it procured goods and services for its property sector clients had been identified as operating in sectors with “higher risk” of modern slavery practices.
These sectors include construction, janitorial services, landscaping ground maintenance, food and drink, and security services.
It has engaged the resources of the Walk Free Foundation to “gain a greater understanding of the substantial threat modern slavery presents in virtually all of the countries in which we operate”, the submission stated.
“Using the Foundation’s Global Slavery Index in conjunction with our client profiles and service requirements, we are conducting a risk assessment to focus on the regions and sectors that pose the most danger, particularly in those countries where the government’s response to the problem is inadequate.”