How can the financial services sector manage their modern slavery risks?
The Australian Human Rights Commission and KPMG Australia have launched a new, practical guide to support the financial services sector to respond effectively to these risks, using a human rights-based approach.
Financial Services and Modern Slavery: Practical responses to managing risks to people is a guide to help the sector respond effectively to the Modern Slavery Act 2018 (Cth) and other global human rights reporting obligations.
“The financial services sector intersects with a range of modern slavery risk areas through its investments, assets, insurance and procurement supply chains,” said Richard Boele, Partner, Human Rights and Social Impact at KPMG Australia.
The Act requires certain large companies to report annually on their efforts to address risks of modern slavery in their global operations and supply chains. There has been a global increase in stakeholder expectations around human rights, including a significant increase in community, regulator and investor scrutiny of human rights performance.
"The guide is part of a two-year collaboration between the Commission and KPMG which aims to support business to respond meaningfully to modern slavery risks across a range of sectors,” said Commission President, Emeritus Professor Rosalind Croucher.
“Effective management of modern slavery risks involves placing ‘risks to people’ at the heart of your response,” said Professor Croucher.
“The financial sector has significant leverage in the business community. As evidence mounts that respect for human rights enhances business resilience, financial sector institutions have a critical role to play in demonstrating and demanding better standards,” said Mr Boele.
The guide showcases examples of current practice from the sector and provides good practice tips on how to manage key risk areas.
“Taking a rights-based approach to addressing modern slavery will assist your business to meet the increasing expectations of investors, governments, clients, consumers, business peers and civil society around business respect for human rights,” said President Croucher.
According to the Global Slavery Index more than 40 million people around the world are living in modern slavery conditions, with up to 15,000 victims living in Australia.
Modern slavery refers to a range of serious human rights violations, which are also crimes in Australia. They include trafficking in persons, slavery, servitude, forced marriage, forced labour, debt bondage, the worst forms of child labour, and deceptive recruiting for labour or services.
The guide is relevant not only to entities that are required to report under the Modern Slavery Act, but also to businesses that are connected to financial sector institutions through asset management, credit, insurance or investor relationships.
In August, the Commission and KPMG launched the first guide in this series, Property, Construction and Modern Slavery: Practical responses to managing risks to people, for the property and construction industry.
Guidance for other high-risk sectors, including the health, food and beverage and mining sectors are currently in development and will be released in coming months.