Review of submissions into the Inquiry into a Modern Slavery Act for Australia
Sophia Collins and Andrew Ray
The Joint Parliamentary Inquiry into a Modern Slavery Act for Australia stopped taking submissions a month ago, on the 19th of May 2017. Many groups and individuals in the Corporate Accountability Network of Australia made submissions. Wondering what other groups had to say? This post analyses the first 100 submissions made to the Inquiry. It identifies the origins of submissions and analyses their key recommendations concerning corporate reporting requirements like those in the UK Modern Slavery Act.
Readers of the Corporate Accountability Network of Australia blog will be familiar with the Joint Parliamentary Inquiry into Establishing a Modern Slavery Act in Australia. The deadline for making submissions to this Inquiry was the 19th of May and the volume of submissions (over 180!) indicates that there is keen interest in this issue. This post examines the first 100 submissions published on the Inquiry website, focusing on submissions which discuss the enactment of provisions like Part 6 of the UK MSA. It identifies who made the submissions and common recommendations about the introduction of corporate reporting requirements in Australia.
Origin of Submissions
To date 184 submissions have been published on the Inquiry webpage. Of the first 100 submissions, the clear majority (85) come from Australian organisations and individuals (or Australian branches of international organisations). Many of the 15 overseas submissions were made by groups and individuals from the United Kingdom. Fifty-seven submissions were made by organisations, including charities, universities, advocacy groups, and faith groups. Twenty-one submissions came from companies (many of which could be impacted by an Australian MSA) and 18 were made by individuals.
The submissions indicate overwhelming support for the introduction of some type of Modern Slavery Act in Australia. Of the first 100 submissions, only two stated that they were opposed to enacting an MSA. However, there was significant variation in the content of the recommendations made by submissions who support an MSA.
There was broad support for some type of corporate reporting requirement. The majority of submissions (69) discussed imposing requirements on certain Australian companies or on companies doing business in Australia to report on their policies to combat modern slavery in their businesses and supply chains. These submissions are the focus of the analysis in the next section. Most discussed these requirements in the context of Part 6 of the UK MSA, and made recommendations based on how those provisions could be improved. The submissions that did not focus on reporting requirements discussed issues such as criminal enforcement of slavery provisions and the interaction between labour laws and slavery.
Although the 69 submissions on corporate reporting made a variety of recommendations, there are several common themes. These include whether Australia should impose mandatory due diligence reporting requirements on companies; create a central repository for reports; appoint an Anti-Slavery Commissioner; and impose penalties for non-compliance.
Mandatory Due Diligence Reporting Requirements
One common issue was imposing a mandatory due diligence reporting requirement on affected companies. Although Part 6 of the UK MSA includes recommendations on the content of compliance statements, ‘the Government has not been prescriptive about the layout or specific content’. This has been criticised because it allows companies to prepare cursory statements which do not provide sufficient detail on the measures they have adopted to combat modern slavery in their supply chains.
Many of the 69 relevant submissions to the Australian inquiry support mandatory due diligence reporting requirements to overcome this issue (48%). Supporters argue that a mandatory due diligence reporting requirement would enhance the effectiveness of an Australian MSA by ensuring that compliance statements are detailed enough to be useful to stakeholders. The suggested content of due diligence reporting requirements differs between submissions. Stronger Together, for example, recommends requiring companies to report on ‘the steps taken, and to be taken in the next year, to assess and address modern slavery’ in a company’s own business and supply chains. Baptist World Aid recommends that companies disclose:
- Efforts to know where production is occurring for each tier of a company’s supply chain including raw materials;
- The specific actions being undertaken to mitigate modern slavery and exploitation in regions where industrial relations systems are undeveloped, where law enforcement is inadequate and where freedom of association and access to other labour rights are restricted; and
- Efforts to address modern slavery in products and regions where modern slavery is known to occur.
Other submissions suggest that there should be more prescriptive requirements, similar to those in California’s Transparency in Supply Chains Act. However, several submissions criticise the creation of such specific due diligence reporting requirements and argue that broader requirements are preferable (7%). These submissions include groups such as South 32, which argues that broad reporting requirements ‘ensure that reporting is tailored, context-specific and practical’ and ANZ which supports ‘flexibility regarding the matters addressed in the [compliance] statement’.
Another common recommendation is establishing a central repository for compliance statements (55%). Lack of a government funded central repository is a key criticism of the UK MSA. Commentators argue that the lack of such a repository frustrates the ability of consumers and investors to access compliance statements and use them to make informed choices. Some submissions recommend that in addition to the repository publishing compliance statements, it also publish the names of all companies required to make statements. According to Ethical Trading Initiative such a list would allow stakeholders to ‘hold companies to account… [when] they know which companies are failing to comply.’ A central repository including a list of companies required to comply could therefore enhance the usefulness of statements and highlight the companies which Rare not meeting their obligations.
Creation of an Anti-Slavery Commissioner or Similar Body
Over a third of the submissions analysed (38%) recommend that an Australian MSA be overseen by a Commissioner or similar body (some recommending an Ombudsman). It is generally suggested that this Officer be responsible for managing the repository of statements, creating guidelines for companies on reporting, and tracking compliance. A Commissioner could also encourage and mediate collaboration between ‘Commonwealth anti-slavery and anti-trafficking enforcement agencies’. There is a Modern Slavery Commissioner in the UK, who recently released his first annual report. This report highlighted the Commissioner’s ability to encourage companies to comply with reporting provisions and target initiatives towards sectors where slavery is likely to be prevalent. The UK framework may therefore provide a model for an Independent Anti-Slavery Commissioner in Australia.
Penalties for non-compliance
Currently, the UK MSA reporting requirement is only enforceable through an injunction sought by the Secretary of State to compel an organisation to publish a statement. Twenty seven percent of submissions analysed support the introduction of more severe penalties for non-compliance. However, there is no consistency in the recommended penalties. Suggested penalties include:
- Fining companies that make false statements or fail to submit a statement;
- Imposing financial penalties on companies who are found to allow slavery to exist within their supply chains;
- Mandating labelling on all goods indicating the level of a company's commitment to eradicating modern slavery within its supply chains;
- Tort remedies for slavery victims; and
- Setting rules for government procurement which require companies to submit compliance statements prior to being considered for government tenders.
A small number of submissions (4%) focused on incentivising compliance rather than penalising non-compliance through strategies such as government support for the costs of compliance and tax incentives for companies who reduce the risk of slavery in their supply chains. Another suggestion is that penalties be phased in over time, allowing companies to make changes to their supply chain policies prior to publishing a statement.
As businesses have a particular stake in this Inquiry (because they may be affected by any legislation introduced), corporate submissions were considered separately. Several large companies such as Rio Tinto, NAB, Wesfarmers, ANZ, and the Adidas Group made submissions. Ninety percent of corporate submissions explicitly support the introduction of a MSA. Many of these companies also discuss the policies they currently have in place to combat modern slavery in their supply chains. Where companies differ in their recommendations is in regard to penalties for non-compliance. None of the companies recommend a penalty be introduced for non-compliance, although some do recommend that rules for government procurement be introduced.
The majority of submissions from companies (55%) recommend information and support from government for affected companies, including guidelines outlining what a compliance statement should include. Many also highlight the importance of any legislation being consistent with reporting requirements under the UK MSA. To this end, 30% of submissions support the creation of an international standard for statements to avoid inconsistent reporting requirements in different jurisdictions. This can be contrasted with non-corporate submissions, 90% of which do not discuss the issue of international consistency.
The first 100 submissions to the Joint Inquiry into a Modern Slavery Act for Australia highlight several key issues that the Government will need to address if it introduces legislation. The majority of submissions support enacting some form of MSA and imposing a requirement on certain companies to publish disclosure statements on their policies to combat modern slavery in their supply chains. In general, submissions support a stricter policy than the UK MSA, with many calling for penalties for non-compliance and mandatory content requirements. Many submissions also emphasise the importance of a central repository to allow stakeholders to use the statements to keep companies accountable. Some argue for an Anti-Slavery Commissioner to manage this repository alongside other duties. Companies tend to support legislation similar to the UK MSA to ensure consistency in reporting requirements and avoid a strict penalty regime.
About the Authors: Sophia Collins and Andrew Ray are law students at the Australian National University.
 Joint Standing Committee on Foreign Affairs, Defence and Trade, ‘Inquiry into establishing a Modern Slavery Act in Australia’, http://www.aph.gov.au/Parliamentary_Business/Committees/Joint/Foreign_Affairs_Defence_and_Trade/ModernSlavery.
 Submission 36 (discusses the undesirability of an ‘enforcement-based approach’, and asserts that the UK MSA ‘allows for the conflation of sex work and trafficking, resulting in a dangerous environment for sex workers generally, but particularly migrant sex workers’); and
Submission 79 (discusses the risk that a MSA could be ‘applied arbitrarily and… be harmful to affected communities’, and urges the Inquiry to focus on ‘industrial relations, visas, importation, manufacturing and labelling’ to combat Modern Slavery instead of a MSA).
 In analysing submissions, where an author stated their recommendations we used those provided, where they did not we derived their recommendations based on their overall submission.
 Home Office, Transparency in Supply Chains: A Practical Guide (29 October 2015) gov.uk, 9, https://www.gov.uk/government/publications/transparency-in-supply-chains-a-practical-guide.
 Submission 76.
 Submission 35.
 See eg Submission 142.
 Submission 81.
 Submission 30.
 Ethical Trading Iniative Submission, http://s3-eu-west-1.amazonaws.com/www.ethicaltrade.org.files/shared_resources/eti_msa_aus_consultation_submission.pdf?lufBmQPRvxfn5EEPN.vp1LAkAOEKlojd.
 Submission 142.
 Independent Anti-Slavery Commissioner, ‘Annual Report 2015-2016’, https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/559571/IASC_Annual_Report_WebReadyFinal.pdf.
 Modern Slavery Act 2015 (UK) s 54 (11).