Our ambition of a 100% electric vehicle (EV) home delivery fleet in Australia by 2030, and our efforts to reduce Scope 3 emissions, have required the ongoing procurement of EVs from several new to market suppliers. We are cognisant of the inherently higher risk of modern slavery in EV supply chains. Workers in the industry are vulnerable to forced labour, hazardous conditions and excessive overtime, among other forms of exploitation both in the production of the vehicles in China, and in the operations to extract raw materials such as cobalt for lithium ‑ion batteries in the Democratic Republic of Congo.

Given the inherently higher risk, in F25 we utilised Sayari, a risk identification and analysis platform, to help identify and validate the ownership structure of a supplier of EVs, with the findings indicating the possibility of links to extreme‑risk regions of China. We therefore required our supplier to undergo a third‑party social compliance audit, and a site visit from our Human Rights team at the manufacturing site that produces vehicles for the Group. The audit identified multiple non‑conformances with local and international laws, and our Responsible Sourcing (RS) Standards. As we gathered further information from the supplier, we found that the supplier was making unlawful salary deductions from workers’ pay, which is a form of withholding wages. The deductions were in the form of disciplinary fines for a range of infractions, ranging up to ~20% of the monthly minimum wage in the region. This finding was assessed by our third‑party advisors LRQA as an indicator of modern slavery.

In line with the United Nations Guiding Principles on Business and Human Rights (UNGPs) and our Human Rights Program (HR Program) principles, we supported our supplier to remediate the impact on workers and put systems in place to mitigate and prevent future harm. After approximately nine months of supporting our supplier through the remediation process, upon follow‑up audit it was confirmed that the supplier has now: 

• changed their processes to align with local regulations and our RS Standards across areas such as employment registration and wages and benefits, including remediating workers for historic underpayments such as unpaid overtime

• improved safety and workplace conditions

• implemented a social compliance standard to monitor their supply chain. 

Drawing on this experience, we have implemented Sayari pre‑screening for all potential suppliers of solar panels and EVs to the Group, with results used to inform sourcing decisions. As a precondition prior to purchase, it is also mandatory for any potential EV supplier who will supply EVs to the Group on an ongoing basis to undergo a social compliance audit at the manufacturing facility.