From paperwork to proof: four steps to stronger modern slavery due diligence 

Most organisations now have the basics of a modern slavery program in place: a policy, a supplier code, questionnaires, and some training. What many don’t show, and haven’t yet needed to, is whether those activities are finding risk where it actually sits.  

As the Australian Government moves towards a proposed legislative reform to introduce a criminal offence for failure to prevent modern slavery, that is the question businesses will increasingly need to answer. Under the proposed offence, entities could become criminally liable if modern slavery occurs in their operations or supply chains and they are unable to demonstrate they took reasonable steps to prevent it. While "reasonable steps" has not yet been defined federally, currently the most useful benchmark is the NSW Anti-slavery Commissioner's Guidance on Reasonable Steps, which shows what a credible ethical sourcing program might look like.  

In preparation for the proposed changes to the Modern Slavery Act 2018 (Cth), we’ve detailed below four areas where we see the biggest opportunity to uplift your due diligence, and what you can evidence in your Modern Slavery Statement. 

1. Supply chain transparency: visibility beyond tier 1 

Organisations will usually have a direct relationship with their tier 1 suppliers. However, the most severe modern slavery risks, including forced labour, child labour, and debt bondage, can be found further down the supply chain in raw material extraction, farming, fishing, and early-stage processing, several tiers away from the buyer. The pattern repeats across industries. A clothing brand headquartered in Sydney may audit their garment factories in Bangladesh, but the cotton in its fabric may come from Xinjiang in China, a region widely reported as linked to state-imposed forced labour. An electronics company knows its contract manufacturer, but not the mines supplying the minerals in its components. A food business buys from a reputable processor, but the seafood, cocoa, or palm oil may trace back to vessels or plantations where workers are mistreated. In each case, a tier 1 supplier location often tells you little about where the real risks are. Mapping every tier for every product is ideal but rarely practical. A better, and more achievable, approach is to map by product and raw material, then go deeper where the risk justifies it.  

We suggest starting with these questions: 

1. Supply chain transparency: How confident are we in the accuracy of our supply chain data? Do we have records of where the products are coming from, or just our suppliers’ head office locations? You want to know where the workforce doing the work is located, not just the head office. 
   
2. High risk categories and countries: Which of our products contain raw materials or components with known modern slavery risks? Where are they sourced? What is the modern slavery risk rating of the country of origin? It is important to ensure you’re across which categories and countries are high-risk and monitor your suppliers accordingly. You may have a high-risk category from a low-risk country (e.g., labour hire work in Australia) or a low-risk category from a high-risk country (e.g., legal services from Malaysia). Use Walk Free’s Global Slavery Index to support your risk ratings. 
   
3. Governance process: Are our policies, processes, and contracts robust enough? Do they give us the right to request information about suppliers beyond tier 1? For priority categories, ask suppliers to disclose their key suppliers and material origins, and build those disclosure rights into contracts. The Australian Government's model modern slavery contract clauses are a practical starting point.  
   

Action: In your Statement, be specific about how far your mapping goes and where it stops, for example, “We have supply chain visibility to tier 3 of the cocoa in our chocolate cookie products, including the site of cookie manufacture in Victoria (tier 1), the site of the chocolate manufacture in Western Australia (tier 2), and the cocoa processing site in Malaysia (tier 3). Our future efforts will focus on attaining full visibility to the farm level (tier 4).” Don't forget your own operations either. Outsourced services on your sites, seasonal or contract workforces, offshore operations, and logistics can all carry risk closer to home. 

2. Supplier compliance: using SAQs and audits to identify good practice 

Supplier audits and self-assessment questionnaires (SAQs) are important tools for identifying potential modern slavery risks. They can also show where suppliers are doing well. Alongside areas that need corrective action, social audits often record good practice that supports worker wellbeing, such as worker bonuses, health and wellbeing programs, free meals, additional paid leave and regular worker engagement surveys. Recognising suppliers who go beyond compliance shows you have visibility of your supply chain, supports constructive engagement and continuous improvement, and helps share positive approaches across your suppliers. 

Action: Use suppliers’ SAQ answers and audit results to sort suppliers into performance bands. Strong, evidenced responses identify good practice you can recognise in supplier scorecards, preferred-supplier decisions and longer-term contracts. Vague or inconsistent responses tell you where to focus additional due diligence. Maintain records of any gaps you find, for example, what was identified, the action agreed, who is responsible, the completion date, and how you confirmed it was resolved. Maintain records of the good too, as while the initiatives belong to the supplier, recognising good practice helps build constructive and long-term relationships with your suppliers and reinforces that responsible sourcing is a shared effort. 

3. Risks: monitor the global landscape for emerging risks 

A risk assessment completed once every two years may already be out of date. Modern slavery risk moves with the global landscape, and a supply chain that looked low risk twelve months ago may not be today. The drivers for this are wide-ranging: 

• Conflict and displacement increase the number of people vulnerable to trafficking and forced labour, including in countries that supply manufacturing, agriculture, and construction labour 
  
• Climate events destroy livelihoods and push people into debt and unsafe migration, while disrupting the harvests and production that suppliers then rush to recover 
  
• Demand surges for commodities, such as minerals and components for the energy transition, can push production into regions and supply chains with weak oversight 
  
• State-imposed forced labour in some regions creates risk that supplier-level due diligence can’t resolve, as suppliers may have no ability to refuse it 

Regulations are also evolving. From 14 December 2027, under the EU Forced Labour Regulation, goods linked to forced labour can be stopped from entering or leaving the EU market, and the US already restricts imports linked to forced labour. A risk several tiers back can quickly become a market access problem for an Australian business. Goods shut out of those markets may also be redirected to markets with fewer controls, including Australia. 

Action: Set up Google Alerts for key modern slavery terms such as worker exploitation, forced labour, debt bondage, recruitment fees. (Tip: don’t set an alert for ‘modern slavery’ as you will be notified every day each time a company publishes its modern slavery statement!). Set up a risk register and add any risks identified in your Google Alerts. For example, if you’re in the packaging industry and your Google Alert notifies you of a news article about illegal logging in one of your source countries, add this to your risk register, reach out to your suppliers and ask if they source from the site in question, and update your register with their response and any evidence provided. In the Statement, describe how your risk monitoring is kept current and give an example of a risk you identified during the year and how you responded. This shows that monitoring risks is a working process, rather than a once-a-year or once every two years exercise. 

4. Worker voice: how to uplift your grievance process 

Few or no complaints may be read as a sign that things are working. However, it might mean that the workers don’t know about the grievance mechanism, it’s not in a language they understand, they don’t know how to access it, or they don't trust it. Many grievance mechanisms are built for internal employees such as an English language hotline or web form on the corporate intranet. These mechanisms rarely reach the people most exposed to modern slavery. A worker on a fishing vessel, a migrant worker in a supplier's factory, a seasonal farm worker, or a child in an informal workshop is unlikely to know the buyer's channel exists, let alone use it. Where workers depend on their employer for housing, visas, or repayment of a debt, they might fear that speaking up may cost them everything. The UN Guiding Principles on Business and Human Rights (Principle 31) set out what makes a grievance mechanism effective: legitimate, accessible, predictable, equitable, transparent, rights-compatible, a source of continuous learning, and designed with the people who will use it. In practice, this means: 

• Extend the reach to your supply chain. Make sure workers at priority suppliers know a channel exists, through site posters, induction materials, supplier contracts, and local partners, not just your website. 
  
• Remove the barriers. Offer channels in workers' own languages and in formats they can use, such as phone, messaging apps, or in person. Allow anonymous reports and never require workers to go through the person they are concerned about. 
  
• Use trusted intermediaries. Independent or shared industry mechanisms, unions, and local civil society organisations often reach workers that a buyer's own channel cannot. 
  
• Ask workers directly. Grievance channels wait for workers to come forward. Worker surveys and confidential interviews bring concerns to the surface earlier. 

Action: Review your grievance mechanisms. Do you have just one? Is it anonymous? Is it in languages other than English? Review your workforce first for other spoken languages. Is there detailed information in areas on site that all workers will see? Uploading to your company intranet helps internal teams, but what about subcontracted workers? Consider printing posters and placing them on the back of bathroom cubicle doors so workers can take note without fear of retaliation.

Where should you start? 

A Modern Slavery Statement reports on the work done during the year. If the failure to prevent offence becomes law, the quality of that work, and the evidence behind it, will matter more than the Statement itself. A practical first step is to test your approach against four questions, one for each area above: 

1. How far into our supply chain can we see? 
   
2. Have we reviewed our suppliers’ SAQs and audits, or did we just file them away and tick the ‘compliant’ box? 
   
3. Are there any emerging risks we should be aware of? Do we have the right processes in place to manage these risks should they arise? 
   
4. If a worker in our operations or in our supply chain was being exploited right now, how would we find out? 

Any question you can't yet answer with evidence is a good place to focus next year's work.