Understanding and managing modern slavery compliance across international supply chains has become a core responsibility for organisations operating in multiple regions. To build a strong compliance program, the most important step is a detailed risk assessment that reveals where vulnerabilities exist and how to address them. This becomes even more significant when your operations span several jurisdictions with different regulatory expectations.
A single universal program can offer a strong foundation however it often requires extensive effort to align with the strictest regional laws. As a result, organisations must refine their policies to meet the unique expectations of each market. This careful adaptation is essential for creating a global compliance framework that is both practical and effective.
Compliance professionals today must navigate an expanding collection of modern slavery regulations that shape corporate responsibility and sustainability. Below is a clear overview of key legislative developments that influence global compliance programs.
Key Regulations Shaping Modern Slavery Compliance
This overview highlights major governance and sustainability laws that affect companies with multinational operations. These include:
- EU Corporate Sustainability Due Diligence Directive
- EU Corporate Sustainability Reporting Directive
- Uyghur Forced Labor Prevention Act
- Canadian Modern Slavery Act
- Australia Modern Slavery Act
- Other emerging regulatory measures
EU Corporate Sustainability Due Diligence Directive
The EU Corporate Sustainability Due Diligence Directive represents a major shift toward stricter accountability in global business. It requires organisations operating in the EU to embed due diligence across all operations and update their policies regularly. These policies must outline the organisation’s approach and include a code of conduct supported by clear rules and principles.
The purpose of the directive is to identify and reduce environmental and human rights harms. These harms include violations linked to forced labor, trafficking, slavery, worker exploitation and environmental damage covered in international agreements.
Covered organisations that identify such harms must follow specific measures such as neutralising impacts, implementing corrective plans, investing in improved practices, supporting small suppliers and collaborating with other organisations when necessary.
Who must comply
- EU based companies with at least 250 employees and at least EUR 40 million in global turnover
- Parent companies with at least 500 employees and at least EUR 150 million in global turnover
- Non EU companies that generate at least EUR 150 million globally and at least EUR 40 million inside the EU
Enforcement
- Fines up to 5 percent of worldwide turnover
- Removal of goods from EU markets
- Possible exclusion from public sector tenders
- Civil liability for failure to comply
A key milestone occurred in December 2023 when EU institutions reached a compromise that paves the way for the directive’s final adoption.
EU Corporate Sustainability Reporting Directive
The EU Corporate Sustainability Reporting Directive expands the earlier non financial reporting rules and requires a broader range of companies to disclose environmental, social and governance information. This includes non EU companies that operate in the region and meet specific thresholds.
The directive also applies to certain small and medium enterprises that trade on regulated EU markets. To support consistent reporting, EU authorities have appointed a standards body to develop unified sustainability reporting rules covering environmental impact, social responsibility and governance practices.
A central feature is the concept of double materiality which requires companies to report how their activities affect society and the environment while also explaining how external risks influence their operations.
Who must comply
- All large companies
- Non EU companies with significant activity in the EU
- Small and medium enterprises listed on regulated EU markets
Enforcement
- Mandatory reporting on sustainability performance
- Compliance with double materiality rules
- Adherence to approved EU sustainability standards
- Staged implementation beginning in 2023
Uyghur Forced Labor Prevention Act
The Uyghur Forced Labor Prevention Act in the United States aims to prevent goods linked to forced labor in the Xinjiang region from entering the country. Goods produced in whole or in part in that region are presumed to involve forced labor unless importers provide clear and convincing evidence that no forced labor was used.
Importers are expected to maintain detailed documentation across the entire supply chain. This may include affidavits, invoices, bills of material and certificates of origin. Failure to meet these requirements can lead to seizure and forfeiture of goods.
Who must comply
- Importers bringing goods from or linked to the Xinjiang region
Enforcement
- Strong presumption of forced labor
- Extensive supply chain documentation requirements
- Potential seizure of goods
Canadian Modern Slavery Act
Canada introduced its first modern slavery law in 2023. It requires qualifying companies to publish an annual report by the end of May each year. The report must describe the company’s supply chain, due diligence programs, policies, training efforts and actions taken to address forced labor or child labor. Companies must also evaluate how effective these measures have been.
Who must comply
- Companies listed in Canada or operating in Canada that meet defined thresholds and are involved in producing or importing goods
Enforcement
- Annual publication of detailed reports on risk mitigation and prevention efforts
Australia Modern Slavery Act
Australia recently completed a formal review of its Modern Slavery Act. The review showed that the original law had limited impact because of inconsistent reporting standards, weak enforcement and difficulty comparing statements from different organisations.
Thirty recommendations were proposed to strengthen the law. These include lowering the reporting threshold, expanding reporting criteria, introducing a due diligence requirement and adding penalties for non compliance.
Who must comply
- Organisations operating in Australia
Enforcement
- Mandatory reporting on modern slavery risks
- Proposed penalties for non compliance
- Recommendations aimed at improving transparency and oversight
Conclusion
Modern slavery legislation continues to evolve worldwide as governments strengthen expectations for transparency and ethical supply chain management. EU directives have introduced comprehensive due diligence and reporting requirements. The United States and Canada have set strong rules that target forced labor in global supply chains. Australia is working toward more rigorous standards following its recent review.
Together these developments show a clear global commitment to eliminating forced labor and protecting human rights in corporate operations.
Dess Digital supports compliance teams by offering training resources that help identify slavery and trafficking risks across internal operations and third party networks. Its continuous monitoring capabilities help organisations stay aware of emerging concerns and maintain stronger supply chain oversight.
