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The Impact of Modern Slavery On Your Business

We all know the saying, ‘Business is business’. However, what happens when business intersects with something as horrific as modern slavery? 

In Australia, modern slavery is a problem that has only been acknowledged and addressed recently. This blog post will explore the issue of business and slavery in Australia and the different ways your business can help put an end to it.

What Is Modern Slavery?

You might think that the concept of slavery is outdated and something that only exists in the history books. However, the sad reality is that slavery is very much alive and well in our world today. Moreover, businesses are likely to have modern slavery undetected in their supply chains and potentially, their operations..

Modern slavery is defined as being put in a situation of exploitation wherein an individual cannot refuse nor leave due to threats, deception, violence, abuse of power and any other form of coercion.

According to a 2022 report by the International Labour Organisation, Walk Free and the International Organisation for Migration, an estimated 49.6 million people around the world were living in some form of modern slavery in 2021. This includes forced labour, sexual exploitation, child labour and forced marriages.

How Does Modern Slavery Affect Businesses?

Modern slavery is a serious human rights violation, and it has a broad range of negative impacts on businesses. As consumers become more aware of the issue of modern slavery, they are increasingly demanding that businesses take action to address the problem. Unfortunately, even companies with the best intentions can inadvertently support slavery through their supply chains. For example, a company may purchase goods from a supplier that uses forced labour, or it may use raw materials that were mined by child labourers.

When news of these practices emerges, it can have a devastating effect on a company’s image and reputation. Likewise, it can undermine the efforts of businesses to create a fair and inclusive workplace. Consumers may boycott the company’s products, and shareholders may divest. 

In addition, the company may face legal action and financial penalties. As a result, modern slavery can destroy a business’s image and reputation, causing irreparable harm to the company. As such, businesses need to be aware of the risks of modern slavery and take steps to prevent it from occurring in their operations.

Granted that this is a huge problem, there is some good news. Australia has recently passed laws making it easier to prosecute people who engage in modern slavery. Increasing levels of public exposure on human trafficking and a growing concern among law enforcement has generated significant support for the minimisation of modern slavery. Whilst more people are becoming aware of the issue and taking action to help those who are affected, there is still a long way to go.

Modern Slavery Act Australia

The Modern Slavery Act 2018 (Cth) (the Act) was passed by the Australian Parliament on 29 November 2018 and came into force on 1 January 2019. 

The Act requires certain large businesses (over $100 million in revenue) to prepare annual statements detailing the steps they have taken to address modern slavery risks in their operations and supply chains.

The Act represented a significant step forward in the Australian Government’s response to combating modern slavery, both domestically and internationally. The introduction of the Act demonstrates Australia’s commitment to playing its part in addressing this global challenge.

The purposes of the Act are:

  • To ensure that there are appropriate penalties for persons who engage in modern slavery;
  • To promote supply chain transparency so that consumers can make informed choices about the products they purchase;
  • To encourage businesses to take action to address modern slavery risks in their operations and supply chains;
  • To encourage victims of modern slavery to come forward and receive support; and
  • To promote cooperation between Commonwealth, State, Territory and local governments concerning modern slavery.

The Act is currently under review and is likely to undertake some significant changes in the upcoming months, notably, the potential establishment of an Anti-Slavery Commissioner on a Federal level.

Steps to Reduce Modern Slavery in Your Business

As a signatory to the United Nations Convention against Transnational Organised Crime, Australia is one of the countries required to adopt measures to prevent and combat transnational organised crime, including trafficking in persons.

The Australian Federal Police is the leading law enforcement agency for combating transnational organised crime, including human trafficking and slavery. State and territory police forces also have a role in investigating and prosecuting human trafficking and slavery offences.

There are several things businesses can do to reduce the risk of slavery occurring in their operations and supply chains. Businesses should:

  • Have policies and processes in place to identify and assess the risks of slavery and trafficking occurring in their operations and supply chains;
  • Provide training to relevant staff on how to identify the signs of slavery and trafficking;
  • Establish mechanisms for employees, contractors, suppliers and other business partners to report concerns about possible instances of slavery and trafficking;
  • Work with suppliers to address any risks identified; and
  • Monitor their operations and supply chains regularly to ensure that risks have been appropriately mitigated.

Australian businesses that fail to take steps to address the risks of slavery and trafficking in their operations may face reputational damage and exposure to civil or criminal liabilities under state or federal legislation.

How Can Madison Marcus Help You

At Madison Marcus, we can help you with modern slavery issues. Our team of reliable lawyers can assist you in complying with the Modern Slavery Act of Australia. We can provide you with guidance on how to develop and implement policies and procedures that will help prevent slavery and human trafficking from occurring within your business. We can also help you create a system for reporting any incidents that do occur. Furthermore, we can assist you in developing training programs for your employees on this topic and audit your supply chain to ensure that there are no links to slavery or human trafficking.

With Madison Marcus, you can be confident that you are taking steps to comply with the Modern Slavery Act of Australia. For all enquiries, contact us here


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