The Modern Slavery Amendment Bill 2021 has been passed by New South Wales Parliament on 14 October 2021. This Bill amends the Modern Slavery Act 2018 (NSW), with the amended Bill will now commencing on 1 January 2022.
The NSW Government had previously stated that they did not want the NSW Act to unnecessarily duplicate the Modern Slavery Act 2018 (Cth).
Under the Commonwealth Act, entities with a minimum annual revenue of $100 million are required to report annually on the risks of modern slavery to their operations and supply chains and actions taken to mitigate risks. Australian fund managers are reporting under the Commonwealth Act both as a reporting entity, and as a supplier of financial services via modern slavery due diligence questionnaires required by clients.
Under the 2018 NSW Act, reporting entities were defined with a lower threshold (an annual revenue of $50 million). Entities with revenue of between $50 million and $100 million will no longer be required to prepare a report under the NSW Act. Entities may still voluntarily prepare a modern slavery statement.
Local governments and state-owned corporations under the Bill must now publish a modern slavery statement. Local governments must take reasonable steps to ensure that goods and services procured by and for the council are not the product of modern slavery.
Notably, the Bill strengthens the independence of the Anti-Slavery Commissioner in the exercise of their powers. Under a previous draft, the Commissioner would have had the power to require the provision of information and production of documents where the Commissioner has reasonable grounds to suspect that practices involving the use of seasonal workers that constitute modern slavery have or are occurring. This was removed from the final Bill.
Under the Bill, the independent Commissioner is empowered to:
- advocate for and promote action to combat modern slavery,
- identify and provide assistance and support for victims of modern slavery,
- make recommendations and provide information, advice, education and training about action to prevent, detect, investigate and prosecute offences involving modern slavery,
- to co-operate with or work jointly with persons and organisations to combat modern slavery and provide assistance and support to victims of modern slavery,
- monitor reporting concerning risks of modern slavery occurring in supply chains of government agencies,
- monitor the effectiveness of legislation and governmental policies and action in combating modern slavery, and
- raise community awareness of modern slavery.
The NSW Government has also committed to lobbying the Commonwealth to lower the $100 million reporting threshold under the Commonwealth act. Further, as the Commonwealth Act includes no penalties for modern slavery practices in commercial supply chains, advocates may push for the Act to have more policing teeth.
Fund managers should continue to consider the risk of modern slavery to their operations and investment activity, and what steps they can take to mitigate these risks including through stewardship engagement.
The Financial Services Council released a guidance note for fund managers on Responding to Modern Slavery Reporting Requirements earlier this year. This can be found here.
Make sure you’re amongst the first to read blogs like this from the FSC.
|SIGN UP TO FSC NEWS|