LONDON (Thomson Reuters Foundation) - Big companies and public bodies in Australia will have to disclose how they tackle modern-day slavery in their operations under a law passed on Thursday that activists say is tougher on business than Britain’s landmark 2015 anti-slavery legislation.
The world’s second anti-slavery law, passed by Australia, requires companies with a turnover of A$100 million or more ($73 million) to publish annual statements outlining the risk of slavery in supply chains and actions taken to address this.
Yet some human rights groups and trade unions said a lack of financial penalties for companies who flout Australia’s Modern Slavery Act was a missed opportunity.
The law was passed amid growing consumer and regulatory pressure upon companies to ensure their goods and services are untainted by the global slave trade, which is estimated by the United Nations to affect at least 40 million people worldwide.
“It’s a significant step forward for modern slavery - it is the strongest legislation in the world,” said Jenn Morris, chief executive of anti-slavery organization the Walk Free Foundation.
“What is key is that there are mandatory reporting requirements ... and the government is applying the same rules to themselves that they are asking businesses to follow,” she told the Thomson Reuters Foundation in an interview in London.
Britain in 2015 became the first country to pass a modern slavery law, yet its government in July announced a review amid criticism that it is not being used effectively to jail traffickers, help victims, or drive firms to stop forced labor.
Compared to Britain’s law, Australia’s legislation is stricter on the information companies must provide, establishes a central database of their annual statements, and compels public bodies to also publish their anti-slavery efforts.
But campaigners and trade unions criticized the omission of an independent anti-slavery commissioner - a role created with Britain’s law - and the lack of financial penalties for companies who do not comply with the reporting requirement.
“As it stands this bill doesn’t send a strong enough message to companies,” Michele O’Neil, president of the Australian Council of Trade Unions (ACTU), said in a statement on Thursday.
“We need fines to really be able to say they cannot get away with tolerating the presence of slavery as ‘business as usual’.”
The Australian government said the inclusion of civil penalties would be considered in a review of the legislation scheduled for three years after it comes into force.
“Business feedback shows market scrutiny as well as reputational risk and reward will drive compliance more effectively than punitive penalties,” Senator Linda Reynolds of the ruling Liberal party said in parliament earlier this week.
The law could improve labor rights from farms in Australia to garment factories in nearby countries such as Cambodia and Vietnam and encourage better cooperation between businesses, investors and civil society, human rights groups said.
“(Governments and businesses in the region) will be galvanized which should generate momentum for similar legislation in Asia-Pacific countries,” said Amy Sinclair of the Business & Human Rights Resource Center - a pressure group.
The law also makes Australia the first country to recognize so-called orphanage trafficking as a form of modern slavery amid a national drive to stop its citizens from giving time and money to institutions overseas that traffic children for profit.
At least 8 million children live in institutions globally, yet four in five have at least one living parent, according to Lumos, which was founded by ‘Harry Potter’ author J.K. Rowling.
“Despite evidence seen in many countries across the world, this form of exploitation is rarely recognized and often under-reported,” said Chloe Setter, a senior advisor at the charity.
“Australia’s law will help to take orphanage trafficking out of the shadows and put it in the spotlight on the global stage.”
Australia is home to an estimated 15,000 victims of modern slavery - from forced labor and sexual exploitation to domestic servitude - according to the Global Slavery Index by Walk Free.