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Specialists in equity portfolios in Asia Pacific, emerging markets, global and sustainable investment strategies

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Human rights and modern slavery

Human rights and modern slavery

Why is it important to us?

In September 2022, the 2021 Global Estimates of Modern Slavery reported that there are an estimated 49.6 million people globally living in situations of modern slavery, an increase of around 10 million people since the previous estimates were released in 20171.

This means one in every 150 people are affected by modern slavery, with women, children and migrants disproportionately impacted2. As these estimates are based on 2021 data, this number does not account for the number of people impacted by the escalation of the Russia-Ukraine conflict.

There is an ever-greater need to focus on this topic, in light of the COVID-19 pandemic, the Russia-Ukraine conflict, the growing recognition of the human rights implications of climate change, and the need for a just and equitable transition to a lower-carbon future. These forces will all have long-lasting and far-reaching human rights implications.

Companies that fail to proactively manage these issues will face an increasing level of scrutiny, in addition to legal, reputational, and financial implications.



What is First Sentier Investors doing? 

Human rights issues are still widely misunderstood by many stakeholders, including investors. FSI first started formal work on human rights in 2016, setting up a human rights working group of investment team members, which culminated in the creation of a Human Rights Toolkit.  

In 2022, we updated the Human Rights Toolkit to provide additional guidance on the human rights implications of armed conflict and arranged for human rights experts from advisory firm Pillar Two, to provide our investment teams with training on this topic. 

We have since engaged with several companies on the issue (see the feature below), as well as with clients. In addition, we lead a sub-group within the Responsible Investment Association of Australasia (RIAA) Human Rights Working Group, focused on developing investor guidance on the implications of armed conflict for investors. Proactive human rights due diligence by companies prior to an armed conflict breaking out is our preferred approach. However, for companies that find themselves potentially causing, contributing or directly linked to human rights abuses as the result of an armed conflict, heightened human rights due diligence provides a framework for navigating the situation, in addition to ensuring the company complies with international humanitarian law.

Throughout the year, we also continued our work on modern slavery. The three-year review of the Modern Slavery Act in Australia provided an opportunity to reflect on what was working under the legislation and how all stakeholders can do better to address this issue. 

We feel that investors have an important role to play in this review process, and contributed to submissions and consultations on behalf of, or as part of, FSI, Investors Against Slavery and Trafficking APAC (IAST APAC), RIAA and the Financial Services Council.

IAST APAC reached an important milestone in 2022, completing its first full year of collaborative engagements (see feature below).

We did some preliminary analysis on other issues including mental health and access to nutrition, which we intend to do further work on in the coming year. 

First Sentier Investors’ Submission to Modern Slavery Act Review

In 2022, the Australian Federal Government undertook a review of Australia’s Modern Slavery Act 2018 (Cth) (Modern Slavery Act). FSI believes that the Modern Slavery Act has been successful in raising business and government awareness of the risks of modern slavery. However, enhancements will be required for businesses to be compelled to identify, report on and, most importantly, address the risks of modern slavery, going forward.

In our submission to the review, we indicated our support for many of the proposed initiatives and made several recommendations, including:

• Reducing the annual revenue threshold for reporting entities to $50 million (from $100 million), subject to greater resourcing to monitor and review the resulting increase in volume of statements submitted

• Refining the definition of ‘modern slavery’

• Harmonising reporting criteria and timelines

• Establishing an Anti-Slavery Commissioner

• Retaining the current, broad approach of non-punitive enforcement mechanisms

• Continuing the Modern Slavery Statements Register

• Considering introducing mandatory human rights due diligence

Reporting on progress

The country map below, taken from our Modern Slavery Portfolio Analytics tool, shows the levels of modern slavery risk across various countries where we invest in listed equities and corporate fixed income. The size of the bubble relates to our exposure to companies across these asset classes (expressed as percentages in the labels), and the colour of the bubble relates to modern slavery risk (darker green = higher risk). Modern slavery risk is measured per country using a combination of factors including the total number of people living in modern slavery conditions, the number of victims as a percentage of population and the country’s vulnerability score as measured by the Global Slavery index. As the map demonstrates, our greatest risks are concentrated in Asia, hence why we decided to focus on this region as part of the IAST APAC initiative profiled above.

According to the 2021 Global Estimates of Modern Slavery, one in every 150 people are affected by modern slavery. Women, children and migrants are disproportionately impacted.

Our global modern slavery risk exposure

Source: Global Slavery Index 2018, First Sentier Investors Data as at 31/12/22


Despite the efforts of many, the number of estimated victims of modern slavery worldwide continues to rise. While the numbers quoted in the Global Estimates of Modern Slavery are concerning, it has made a number of recommendations to action between now and the 2030 target date for eradicating modern slavery.

As responsible investors, we have a responsibility to set expectations that investee companies find, fix and prevent modern slavery within their operations and supply chains, as well as engage with policy makers and broader stakeholders including survivors, civil society organisations and ESG data providers.

Future plans

After we complete our fourth consecutive modern slavery statement in 2023, we will review the effectiveness of our approach and refine it as appropriate. We will also continue the engagement with companies in relation to the human rights implications of the Russia-Ukraine conflict and other armed conflicts globally. This will build on the preliminary analysis already completed on the topics of mental health and access to nutrition.


First Sentier Investors has developed a Human Rights Toolkit to help all investment teams globally better manage human rights risks in our portfolios. The toolkit provides research and guidance for each of the following steps:

  • Identifying companies with a risk of human rights in their operations or supply chains
  • Assessing companies’ approach to the issues identified
  • Engaging with the companies identified as at risk of human rights violations
  • Internal reporting on our progress

This has formed the basis of our approach to addressing human rights risks within our investment portfolios, which we are required to report on in accordance with legislation in Australia.

Download our latest Modern Slavery Statement.


  1. Modern slavery includes crimes such as forced labour, debt bondage, human trafficking, child labour and forced marriage and disproportionately affects vulnerable communities. 
  2. International Labor Organization, 2016

Discover our Responsible Investment report

As long-term investors, we know that the decisions we make today impact communities today, tomorrow and years from now. Responsible Investment is at the core of how we operate as a business and allocate capital, and we are committed to transparency and accountability regarding our performance in this area.