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Modern slavery reporting - Mandatory Criteria 1 and 2

Businesses with an annual consolidated revenue of over $100 million must submit a Modern Slavery Statement (MSS) outlining the risks of modern slavery in their supply chain within six months of the end of their reporting period (whether that be a financial or calendar year). There are seven mandatory criteria for an MSS. The information here relates to Criteria 1 & 2, which requires an MSS to include information about a business’s structure, operations and supply chains.

What is your business structure?

Your MSS must clearly identify your business. Ways of doing this might include setting out the business name on the front page of the statement and/or including any logos or relevant branding.

Your MSS must also describe your businesses structure. This could include:

  • describing the businesses general structure – i.e. company, partnership, trust, etc. 
  • explaining whether your business owns or controls other businesses or is part of a larger corporate group
  • providing your businesses ACN and registered office address
  • providing an approximate number of employees.

How should I describe my businesses operations?

Your businesses operations are the activities carried out by the business to pursue its business objectives.

To describe your businesses operation your MSS could:

  • describe the type of activities (there may be more than one) carried out by your business and any business you own or control – for example:
    • Do you directly employ your workers? e.g. your business employs workers in a manufacturing company’s factories
    • Is your business involved in processing and production? e.g. your business is a cabinetry company whose operations include procurement of materials and assembly
    • Does your business provide and deliver products or services? e.g. you are engaged as a builder under a preliminary agreement to provide services related to non-residential building work, or>/li>
    • Is your business involved in construction? e.g. Are you a residential builder whose operations includes the construction of residential buildings?
  • identify the countries or regions where your business operations are located or carried out
  • provide facts and figures about your business’s operations, including the total number of employees, factories and/or stores
  • describe the relationships between your business and your suppliers
  • describe the types of business relationships your business has with others aside from you suppliers (e.g. joint venture partners).

How do I describe my business’s supply chains?

Your business’s supply chains include the products and services (including labour) that add to your businesses own products and services. This also includes products and services obtained within Australia or internationally and goes beyond direct suppliers.

The definition of supply chain includes:

  • Products provided to the entity by suppliers – e.g. a building company’s supply chain includes resin provided by a building product retailer 
  • Services provided by suppliers – e.g. a building company’s supply chains include its specialist subcontractors, and
  • Products and services used by indirect suppliers in the entity’s supply chains – e.g. the supply chains of a kitchen company include the procurement and transportation of marble used in its benchtops.

When describing your businesses supply chains, your MSS should:

  • identify the countries/regions where your business’s suppliers are located
  • describe the main types of goods and services bought by your business
  • identify the countries from which these goods and services originate, and 
  • link to any information publicly available about your suppliers. 

Example – information about a business’s structure, operations and supply chains:

ABC Pty Ltd is a residential builder that provides residential construction services throughout Australia. We have offices in Queensland, Victoria and NSW with our head office being based in Sydney. We have 30 employees and can engage up to 300 independent contractors at any one time. We source a range of building products both locally and from overseas. 

For further information, view the ‘Guidance for Reporting entities’ published by the Department of Home Affairs.

This information is part of a series on modern slavery reporting requirements aimed at assisting members understand the requirements. See the related documents contained in the ‘What to read next’ section for more information. 

To find out more, contact HIA's Contracts and Compliance team

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