Westpac and ANZ has received high scores for their modern slavery disclosures, while Bank of Queensland, Bendigo and Adelaide Bank and Afterpay all received low scores.
The Monash Centre for Financial Studies has produced a ranking of the modern slavery disclosures of ASX 100 companies, reporting that there is wide dispersion in terms of disclosure quality.
The authors of the report, three Monash research fellows, have called on the government to provide more reporting guidance to ensure consistency and to improve remediation processes.
The Modern Slavery Act was passed in 2018 and took effect on 1 January 2019. Reporting is mandatory for companies with more than $100 million of turnover and the first reports were due six months after the end of the reporting entity’s first full financial year.
For most companies the first deadline was December 2020 (which was extended to March this year). For the rest, the first reporting deadline was 30 June this year.
The Modern Slavery Act provides eight types of exploitation that meet the definition of modern slavery. They are trafficking in persons, slavery, servitude, forced marriage, forced labour, debt bondage, deceptive recruiting for labour or services and child labour.
Reporting entities must describe the risk of modern slavery practices in their operations and supply chains and describe actions taken to address any risks.
Westpac was ranked fourth for the quality of its disclosure, ANZ seventh, Commonwealth Bank 35th, NAB 55th, Macquarie Group 59th, Bank of Queensland 77th, Afterpay 86th and Bendigo and Adelaide Bank 87th. More than half of the disclosures of financial services companies were in the bottom half of the table.
According to the report, only 17 per cent of companies provided specific KPIs for effectiveness.
Only a little over half (56 per cent) provided an evaluation of the level of modern slavery risk in their operations and supply chains.
Only 62 per cent directly assessed one of more of the eight specific risks.
The report said poor description of the supply chain was a common problem, along with failure to assess specific risks, unclear descriptions of governance structures to manage risks and unclear descriptions of remediation processes.
Some reports displayed a poor understanding of how the company goes about some of the processes and a lack of awareness of available resources and tools.
Among all the companies in the survey, the risk with the highest prevalence was forced labour, reported in 29 per cent of cases, child labour 27 per cent, debt bondage (23 per cent) and human trafficking (22 per cent).