Modern slavery: boards must lead with integrity

As boards begin their 2025 planning cycles, the release of the ‘Building consensus: A comprehensive framework for combatting trafficking in persons and modern slavery in New Zealand’ report offers a timely reminder of the critical role directors play in addressing modern slavery risks. 

The report by the Modern Slavery and Trafficking Expert Practitioners Group underpins a private members’ bill, the Combatting Trafficking in Person and Modern Forms of Slavery Bill, which seeks to propel New Zealand’s response to modern slavery forward.

While progress on modern slavery legislation has stalled in recent years, this initiative – crafted in collaboration with Labour and National MPs – represents hopes for a bipartisan effort to create meaningful change. It provides an opportunity for New Zealand’s laws to reflect international best practice with key trading partners such as Australia, Canada, the UK and EU. 

The collaborative approach reflects a shared understanding that addressing modern slavery is not only a moral imperative but also an economic and social priority for New Zealand. 

For directors, this presents an opportunity to support legislative progress while demonstrating leadership in fostering ethical and sustainable governance practices that address business, investment, trading and reputational risk.

Modern slavery, which includes forced labour, debt bondage, human trafficking and other exploitative practices, remains a pervasive issue within global supply chains. For New Zealand businesses, the risks associated with modern slavery are not abstract – they are part of our workforces and our supply chains. 

An estimated 3,000 people are living in modern slavery conditions in New Zealand on any given day. As part of a highly interconnected global economy, organisations here often rely on supply chains spanning regions with higher vulnerability to exploitative practices. In 2022, according to World Vision, New Zealand imported $7.9 billion of risky goods associated with child and forced labour.

Failing to address these risks poses not only ethical concerns but also significant reputational, legal and operational challenges. Modern slavery is no longer a niche issue; it is a boardroom imperative.

Key features of the proposed legislation

The Combatting Trafficking in Person and Modern Forms of Slavery Bill aligns with international standards and introduces critical mechanisms for addressing modern slavery risks. Among its notable provisions are:

Mandatory reporting: The Bill requires public and private entities with annual revenues exceeding $50 million to disclose how they identify, mitigate and address risks of trafficking and modern slavery within their operations and supply chains.

Independent oversight: The establishment of an Independent Anti-Slavery Commissioner (Australia appointed their first Commissioner in 2024) ensures accountability and monitors progress.

Legal reinforcements: Updates to Sections 98B and 98D of the Crimes Act 1961 to strengthen legal provisions related to trafficking in persons.

Victim protections: Enhanced protections for victims of trafficking reflect a commitment to human rights.

Public register: A government-operated, publicly accessible register for modern slavery statements to enhance transparency and accountability.

This legislative framework encourages transparency, fosters accountability and supports businesses in taking meaningful action. It goes beyond the current Private Members’ Bill, The Crimes (Increased Penalties for Slavery Offences) Amendment Bill, which passed its first reading in December 2024.

This Bill, by National MP Greg Fleming who has also been part of the group working on the new Bill, focuses on aligning penalties for slavery offences with those for trafficking in persons under the Crimes Act 1961. Submissions on this Bill close on 13 February, 2025.

Modern slavery reporting requirements are not merely about compliance. They offer a chance for boards to lead with integrity, ensuring their organisations operate responsibly in an increasingly interconnected and scrutinised world.

Boards must foster cultures of accountability and ethical leadership that extend beyond regulatory obligations. 

Considerations for directors

Embed into risk frameworks: Boards must ensure their organisations have robust systems for identifying, addressing and mitigating modern slavery risks. This includes recognising financial and reputational risks, and integrating modern slavery considerations into risk management, procurement and reporting processes.

Champion transparency: Stakeholder expectations around transparency are rising. Boards should prioritise clear and comprehensive disclosures around modern slavery risks and actions taken.

Conduct supply chain due diligence: Ensure regular, comprehensive audits of supply chains to identify and address potential exploitation.

Organisational culture: Boards need to have a beyond-compliance approach to ethical practices and human rights, and foster a culture that prioritises ethical practices.

Build ethical capacity: Boards need to develop the capabilities to dynamically respond to societal challenges, such as modern slavery, from an ethical perspective. 

*AI assisted