Addressing modern slavery risks more critical than ever: RIAA

This year's Responsible Investment Association Australasia (RIAA) Conference will help financial services professionals address modern slavery risk in portfolios, particularly as new laws propose entities should identify and take reasonable action on such risks.

Ahead of the annual conference in Melbourne next month, Ethical Investment Advisers financial adviser Karen Macleod says it is important for the investment community to be aware of and address modern-day slavery and human rights abuses in business practices.

At the Human rights and modern-day slavery workshop, which Macleod is co-presenting, investment professionals, particularly financial advisers, will learn how to understand and assess human rights and modern-day slavery risks in portfolios.

"The workshop offers practical steps that advisers can take back to their office so they can ask better questions of fund managers and assist their clients in understanding the industries, services or products that have a high risk of modern-day slavery involved in them. It will help them identify and manage those risks and make decisions based on better due diligence and reporting," she said.

A specialist in ethical investments, Macleod's passion for ethical and responsible investment emerged in the mid-2000s as the world started to take note of the emerging climate crisis. She realised clients wanted to make a difference by investing in solutions to save the planet such as renewable energy and recycling.

In terms of modern-day slavery, Macleod said there are a lot of human rights issues that are hidden in plain sight.

"We have expectations from our clients - that the businesses we are investing their capital in are identifying and taking action against modern slavery and human rights abuses," she says.

In November 2024, Chris Evans was appointed as Australia's inaugural Anti-Slavery Commissioner, responsible for working with government, businesses, civil society and people with lived experience to address modern slavery.

In January, Evans handed down the Recommendations to strengthen Australia's modern slavery laws report, an initial position paper that essentially proposes two key areas.

The first is a mandatory risk-based modern slavery due diligence obligation for reporting entities under the Modern Slavery Act. The second is a mechanism for the commissioner to declare that a product, service or industry carries a high risk of modern slavery and require entities to have regard to declarations in their due diligence and reporting obligations under the act.

"We have known for years that the Modern Slavery Act's transparency measures alone have not created meaningful impact for exploited workers. Currently, reporting is mandatory but taking action is not, leaving workers exposed and responsible businesses disadvantaged," said Evans.

"Other like-minded countries have already legislated mandatory due diligence regimes, recognising that reporting is not enough and that real action is required. These reforms are pragmatic, enforceable and designed to deliver real change for people trapped in modern slavery."

Macleod said the initiatives aim to strengthen the effectiveness of the anti-slavery framework for years to come. The original framework was made in 2018.

"It's really an important point for advisers to be aware of this change, because if it does go through, it's more to say that the companies and businesses won't just have to report on one slavery, but in fact, start acting on what they find. And that's quite a big differentiator," she added.

The 2026 RIAA Conference Australia will take place at the Melbourne Convention & Exhibition Centre on May 27 and 28.

Financial Standard is the official media partner of the 2026 RIAA Conference Australia.