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The first modern slavery statements will soon be due – reporting entities should prepare
Reporting entities should continue to address modern slavery risks during this COVID-19 pandemic and start considering the mandatory reporting criteria in preparation for submitting their first modern slavery statements, writes Arthur Marusevich.
Arthur Marusevich
Modern slavery legislation
The newly released Commonwealth Guidelines contains helpful tips on determining whether an organisation is an Australian entity or a foreign entity conducting business in Australia, and how to calculate the organisation’s consolidated revenue.
Temporary extension
Earlier in the year, reporting entities due to submit their first modern slavery statements in 2020 were granted an additional three months. The aim of the extension was to support reporting entities to assess modern slavery risks associated with COVID-19 and include those assessments as part of their modern slavery statements.
The following table sets out the updated reporting deadlines:
| Reporting period |
Original deadline for submission of modern slavery statement
|
New, extended deadline for submission of modern slavery statement
|
|
1 April 2019 – 31 March 2020 (foreign financial year)
|
30 September 2020 | 31 December 2020 |
|
1 July 2019 – 30 June 2020 (Australian financial year)
|
31 December 2020 | 31 March 2021 |
|
Reporting periods ending after 30 June 2020.
|
The six-month deadline for reporting periods ending after 30 June 2020 remains unchanged.
|
The six-month deadline for reporting periods ending after 30 June 2020 remains unchanged.
|
It is important to note that the act does not require reporting entities to certify that they are modern slavery-free. Rather, reporting entities are required to make reasonable efforts to understand, catch, remediate and mitigate modern slavery and modern slavery risks in their operations and supply chains.
A modern slavery statement must cover at least the following mandatory criteria:
- the identity of the reporting entity;
- the structure, operations and supply chains of the reporting entity;
- the risks of modern slavery practices in the operations and supply chains of the reporting entity, and any entities that the reporting entity owns or controls;
- the actions taken by the reporting entity and any entity that the reporting entity owns or controls, to assess and address those risks;
- how the reporting entity assesses the effectiveness of such actions;
- the process of consultation with any entities the reporting entity owns or controls or is issuing a joint modern slavery statement with; and
- any other information that the reporting entity, or the entity giving the statement, considers relevant.
In case of non-compliance, reporting entities will be dealt with in one of two ways. First, the relevant minister may request an explanation for the non-compliance with a reporting obligation.
Second, the relevant minister may request that the reporting entity undertake a remedial action in relation to the failed compliance of a requirement. If the reporting entity fails to comply with the minister’s request, the minister may publish the reporting entity’s identity and details of the non-compliance.
The spotlight is now on reporting entities to make genuine attempts and address modern slavery risks in their operations and supply chains.
Arthur Marusevich is a lawyer based in Canberra.
