Fighting Against Forced Labour and Child Labour in Supply Chains Act (Bill S-211) is a new law that requires companies to disclose if they are mitigating risks related to forced labour and human trafficking in their global supply chains. The act applies to any entity—including corporations, trusts, partnerships or other unincorporated organizations—listed on a Canadian stock exchange that has a place of business, does business or has assets in Canada. Affected companies must also meet at least two of the following conditions for at least one of their two most recent financial years:
- Have at least $20 million in assets
- Generated at least $40 million in revenue
- Employed an average of at least 250 employees
Although the act imposes a new administrative burden on companies, it is an opportunity for them to showcase efforts taken. This is a public document; if they do nothing it poses a reputational risk. The flip side is the opportunity to showcase excellence in this area and it’s going to drive companies to do better for that reason. By complying with the act, companies gain greater transparency into their supply chains, which can simultaneously facilitate addressing similar legislation globally, assist in addressing supply chain sustainability issues, mitigate reputational risks and enhance organizational resilience.