Attorney General and Anti-Slavery Commissioner quietly explore options for modern slavery reform

Modern Slavery Act – current obligations

The Commonwealth Modern Slavery Act 2018 (the Act) entered into force on 1 January 2019.

The Act requires certain entities to prepare and submit an annual statement to the Department of Home Affairs outlining the risks of modern slavery in their operations and supply chains, and the actions they are taking to address those risks. This reporting obligation applies to large businesses and other entities operating in the Australian market with annual consolidated revenue of at least $100m.

Reforms under consideration

Significant reforms to the Act are currently under active consideration, following the 2024 independent statutory review of the legislation by Professor John McMillan AO That review made 30 recommendations aimed at strengthening the Act and its administration.

Consultation took place in the second half of 2025 on those review recommendations agreed to in principle by the government. As part of that consultation process, the Attorney General’s Department (the Department) released a consultation paper outlining options to strengthen the Act’s mandatory reporting framework, simplify and improve reporting, and target non-compliance.

The AICD’s submission to the consultation gave in-principle support to many of the proposed reforms to the Act, particularly the measures that provide clarity, strengthen enforcement in a proportionate way, and reduce unnecessary administrative constraints. The AICD highlighted that reforms must avoid excessive compliance burdens that distract board attention, particularly given the government’s broader productivity agenda.

Further consultation by Department and Commissioner

In January 2026 the Department commenced a further, closed consultation on additional review recommendations that do not currently have government support.  In particular, the Department has been seeking views from certain stakeholders on:

• the introduction of a mandatory due diligence obligation for reporting entities under the Act (Australian entities with annual revenue of at least $100m); and

• the ability for the government to make declarations that certain matters carry a high risk of modern slavery.

In response to the Department’s consultation, the Office of the Australian Anti-Slavery Commissioner published a Position Paper in support of both proposals and invited comments on that paper.

The AICD has made submissions to both the Department and the Commissioner in response to these new consultation processes. Our policy positions on the two key proposals are outlined below.

Mandatory due diligence obligation

The Department is considering introducing a mandatory, modern slavery-focused due diligence obligation. This obligation would require reporting entities to demonstrate that they are taking steps to identify, prevent and address modern slavery in their operations and supply chains.

The AICD does not support a new and complex mandatory due diligence obligation, especially given the $100m reporting threshold. Significant time and resources are already spent on complying with the regime, with many reporting entities struggling to meet their existing obligations.

Other considerations in our opposition to the proposed obligation include:

• Existing barriers to undertaking the requisite due diligence on organisations’ operations and supply chains;

• The growing volume of federal regulation which has contributed to the approximately $160bn compliance burden faced by Australian organisations (as detailed in the economic research prepared for the AICD by Mandala Partners); and

• The fact that a new due diligence obligation would go beyond the approach currently taken in many comparable jurisdictions. In the few jurisdictions where such an obligation exists, there have been much higher applicable thresholds than is contemplated in Australia.

Instead of introducing a mandatory due diligence obligation, the AICD is encouraging the Department and the Commissioner to focus on developing detailed guidance on suggested due diligence processes to assist entities.

Imposing new complex requirements on many medium sized enterprises is likely to have little practical impact on combatting modern slavery while imposing significant compliance costs.

High risk declarations

The Department is also considering whether the government should be able to make formal declarations that certain matters (e.g. region, location, industry, product, supplier or supply chain) carry a high risk of modern slavery. In the Position Paper,  it is proposed that the Commissioner would be tasked with making the declarations.

The AICD supports a mechanism for the Commissioner to declare that a product, service or industry carries a high risk of modern slavery and believes that the Commissioner is well positioned to support compliance with the Act in this way.

The AICD believes that publishing such declarations would:

• Support entities to manage their obligations under the Act;

• Help inform decisions prior to entering new supplier arrangements;

• Provide a trusted, localised source of data;

• Save entities having to undertake expensive investigations; and

• Avoid businesses being exposed to geopolitical risks.

The AICD sees it as critical that there should be no new statutory obligations on reporting entities linked to the proposed declarations - it is important that there is not a layering of new obligations when entities are still struggling with existing obligations.

Broader rethink required

More broadly, the AICD is calling for a more fundamental rethink of the current modern slavery regime – away from broad-based reporting and towards a targeted, high-risk sector approach.

Currently many of the 3,000 entities captured by the $100m threshold have limited understanding of modern slavery risks. The government’s focus should be on helping organisations where modern slavery risks are greatest. This will, in turn, have the greatest benefits for combatting the scourge of modern slavery.

Next steps

As a fundamental prerequisite to the government considering these two new proposals from the Department, the AICD believes that a further, formal and public consultation process is required. 

A considered public consultation with an accompanying detailed discussion paper is critical to support robust policy deliberations. This will allow a sound policy making process to be undertaken and advice provided to government to enable it to make an informed decision.

A public consultation is also the only way to allow the approximately 3,000 affected entities to provide feedback on the implications of a due diligence process for their operations. This is vital for a proper consideration of whether it is appropriate for the government to implement further reform at this time.