Release of multi-jurisdictional modern slavery reporting template and guidance

The United Kingdom, Australian, and Canadian governments have jointly introduced an optional template and guidance titled International Reporting on Modern Slavery, Forced Labour and Child Labour, designed to streamline compliance for entities subject to supply chain transparency legislation in multiple jurisdictions (in Canada, under the federal Fighting Against Forced Labour and Child Labour in Supply Chains Act [MSA]). The template aims to reduce the administrative burden for organizations required to report in more than one of these countries.

Key reporting requirements

The template outlines seven core reporting areas:

• Organizational Structure and Supply Chains: A description of the organization's structure, operations, activities and supply chains, including consultation with any linked organizations covered by the statement.
• Policies: A description of the organization’s policies in relation to modern slavery, forced labour, and child labour. 
• Risk Management: A description of any risk management processes in place to assess and address the risk of modern slavery, forced labour and child labour practices in the reporting organization's supply chains.
• Due Diligence and Remediation: A description of the organization's due diligence processes in relation to modern slavery, forced labour and child labour in its supply chains. In addition, a description of any measures taken to remediate any instances of modern slavery, forced labour and child labour in its supply chains. 
• Training: A description of the training provided to employees on modern slavery, forced labour and child labour.
• Assessing Effectiveness: A description of how the organization assesses the effectiveness of the actions it has taken to prevent and respond to modern slavery, forced labour and child labour, and its due diligence processes. 
• Additional Relevant Information: Any other information the organization considers relevant. 

The first six requirements generally align with the reporting obligations set out in subsection 11(3) of the MSA. The seventh requirement is not mandated under the MSA but is included in the Australian legislation.

The template does not explicitly require entities to report on the steps taken during the previous financial year to prevent and reduce the risk of forced labour or child labour in their supply chains—a specific requirement under the MSA. (MSA reports often address this in a separate section.) However, the accompanying guidance clarifies that disclosures should relate to the previous year. As well, each of the first six reporting requirements includes a "continuous improvement" component, which calls for a description of any changes since the last report, and requirement seven includes a “year-on-year progress” component. 

Levels of disclosure: Level 1 and Level 2

For each reporting area, the template distinguishes between "Level 1" and "Level 2" information.

Level 1 information is information that should be disclosed, according to the template guidance, and Level 2 information is additional information that can be disclosed to demonstrate progress and leadership in supply chain transparency. 

Continuous improvement and a commitment to eradicating modern slavery are expected in all three jurisdictions. This expectation is reflected in both the Level 1 and Level 2 disclosures. However, it is important to note the template and its guidance are not legally binding, and even Level 1 disclosures may exceed the minimum requirements under applicable legislation. Organizations should therefore use the template with caution and ensure their disclosures are consistent with the specific legal requirements and guidance in each jurisdiction.

Proportionate, risk-based reporting

The template encourages proportionate, risk-based reporting, advising organizations to tailor the level of detail in their disclosures and the measures implemented to the degree of risk present. In this context, "risk" refers to the risk to people, rather than financial or reputational risk. This is consistent with previous guidance issued by the Canadian government.

Applicability and deadlines

While the template is primarily intended for entities with reporting obligations in multiple jurisdictions, the guidance recommends all reporting entities review the template alongside jurisdiction-specific guidance. For Canadian reporting entities, the next reporting deadline is May 31, 2026. Entities incorporated under the Canada Business Corporations Act must also deliver a copy of their reports to shareholders with their financial statements, often necessitating finalizing reports well before the filing deadline.

Conclusion

The introduction of the template and related guidance by the United Kingdom, Australian, and Canadian governments creates an opportunity for streamlined compliance for entities operating across multiple jurisdictions. However, organizations must exercise caution in implementing the template, as some suggested disclosures may exceed the minimum requirements under applicable legislation. It is important for entities to ensure their reporting aligns with the specific legal requirements of each jurisdiction.