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Setback in New Zealand’s Anti-Modern Slavery Initiative Raises Concerns
Just as everyone thought New Zealand was advancing in its anti-modern slavery initiative, the government did an abrupt about-face that’s raising concerns among advocates and business and community leaders.
“We’re taking action to address modern slavery and eliminate exploitation in our supply chains. It’s vital we bring modern slavery practices out of the shadows and into the daylight so we can ensure workers are safe and treated with dignity,” said Carmel Sepuloni, deputy leader of the Labor Party and MP for Kelston, in an announcement in July 2023. “This proposed legislation and public register will be among the world’s strongest reporting systems for tackling modern slavery.”
While details are still emerging, the delay in disclosure has prompted questions about the communication processes involved and their potential implications. The incident, which remained under wraps for several months, is now drawing attention both domestically and internationally. Observers have pointed to the need for greater transparency and timely reporting of such events in order to maintain public trust and effective response measures.
Authorities have acknowledged the delay and expressed a commitment to improving information-sharing protocols to ensure that similar events are reported more promptly in the future.
Modern Slavery Initiative Setback
In May 2024, the government disbanded the Modern Slavery Leadership Advisory Group. While modern slavery is still under consideration, the government is prioritizing other workplace issues for now, according to Workplace Relations and Safety Minister Brooke van Velden. The decision has drawn attention, especially in light of recent discussions on the importance of addressing exploitation in supply chains.
The advocacy group World Vision New Zealand called out the government for this sudden about-face. It urged the government to get back on track in advancing legislation, which it said is “a move experts and stakeholders believe is important for New Zealand’s commitment to human rights, sustainability, and global market competitiveness.”
New Zealand consumers have shown the highest levels of spending on goods from certain countries that have been associated with less ethical production or sourcing practices:
- China (74%, $5.8 billion),
- Indonesia (7%, $585 million),
- Vietnam (5%, $432 million), and
- Malaysia (3%, $270 million).
Potential Implications for New Zealand
Advocates and business leaders are concerned that without a modern slavery legal framework and government guidance, New Zealand risks falling behind international business standards, which could negatively impact its global competitiveness.
Christina Stringer, director of the University of Auckland Business School’s Centre for Research on Modern Slavery, said the lack of modern slavery law undermines the country’s global standing and confidence among global investors and trading partners.
“New Zealand has now fallen further behind our international trading partners, many of whom have increasing expectations for frameworks that ensure modern slavery does not take place in global and domestic supply chains,” she said.
Another consideration is the responsibility of New Zealand companies in ensuring ethical sourcing and production practices across their supply chains. Without a modern slavery law, companies are less inclined to perform voluntary due diligence, and when they do, their efforts are likely to be haphazard and inconsistent.
Rebekah Armstrong, head of advocacy of World Vision NZ, noted that 70% of more than 200 businesses surveyed by her organization had no mechanisms in place to address modern slavery.
In the financial community, a group of fund managers responsible for managing $295 billion in investments asked the government for a robust modern slavery law that matches investors’ expectations.
In a letter to van Velden, the group says investors rely on comprehensive and accurate corporate disclosures of risks to make well-informed investment decisions. “Neither of these things can be achieved without the inclusion of a due diligence requirement in New Zealand’s legislation,” it said. The group noted that Germany, France, Norway, and Switzerland have similar due diligence-based laws.
Likewise, international regulations, such as the European Union’s Corporate Sustainability Due Diligence Directive (CSDDD) and Corporate Sustainability Reporting Directive (CSRD), are elevating standards for human rights and environmental due diligence.
The CSDDD requires businesses to conduct human rights and environmental due diligence in their operations and value chains. It’s expected to harmonize existing requirements across the region, serving as a benchmark for other countries. Meanwhile, the CSRD provides a reporting framework for mandated annual sustainability reports on ESG performance, including modern slavery. It requires more detailed disclosures of corporate sustainability efforts, and therefore more rigorous than the Non-Financial Reporting Directive (NFRD), which it replaced.
“The pressure on New Zealand businesses to address modern slavery in their supply chains has grown exponentially. Failing to align New Zealand’s laws with international standards puts existing agreements as well as future trade negotiations at risk,” said Natalia Szablewska, law professor at The Open University.
The calls for anti-modern slavery legislation in New Zealand are part of a broader global movement toward greater corporate responsibility and more ethical supply chains. More jurisdictions are transitioning from voluntary transparency requirements to mandated reporting and due diligence-based compliance, signaling a growing expectation that businesses address human rights issues as part of their operations.
