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Modern Slavery Policy and Statement

Introduction

Under the Modern Slavery Act 2018 (Cth) (the Act), ‘modern slavery’ is defined as conduct which would constitute an offence under the human trafficking, slavery and slavery-like offence provisions under Divisions 270 and 271 of the Criminal Code Act 1995 (Cth), whether the conduct took place inside and outside of Australia. It also incorporates trafficking in persons and the worst forms of child labour as defined in the International Labour Organisation Convention.

Coverage

This policy applies to all employees, contractors and suppliers of the Linfox Armaguard Group including Linfox Armaguard Pty Ltd (ACN 099 701 872), and its subsidiaries including , Point 2 Point Secure Pty Ltd (ACN 149 376 116), Integrated Technology Services Pty Ltd (ACN 079 514 917), Armaguard Technology Solutions Pty Ltd (ACN 601 253 187), ACM New Zealand Limited (NZCN 2194349), Integrated Technology Solutions Limited (NZCN 1299587) and Global Integrated Solutions Limited (NZCN 2227543) (together, Linfox Armaguard).

Purpose

This policy sets out Linfox Armaguard’s commitment to ensuring there is no modern slavery in its supply chains or in any part of its business. Linfox Armaguard operates in Australia, New Zealand and Thailand and is dedicated to reducing the risk of modern slavery arising, directly or indirectly, out of its business activities and within its supply chain, both nationally and internationally.

Our Approach

We have a zero-tolerance attitude and approach to modern slavery and are determined to promote awareness within our workforce and supply chain of the risks relating to modern slavery. We are committed to acting with integrity in all business dealings and relationships and to implementing and enforcing effective systems and controls to assess and manage modern slavery risks.
We expect that our employees and contractors will comply with this policy and uphold our values at all times and any breaches of our policy will be subject to investigation and potential disciplinary action.
We expect that our customers and suppliers match and reflect our dedication to preventing the existence of modern slavery within our supply chain and that they comply with all applicable legislation and regulations in relation to workplace rights and labour laws. Any breaches of our supplier agreements arising under this policy will be referred to General Counsel for investigation and potential breach action.

Modern Slavery Statement

Linfox Armaguard acknowledges that it is a reporting entity for the purposes of the Act. This includes and extends to its related bodies corporate for the purposes of the Corporations Act 2001 (Cth). Linfox Armaguard is committed to meeting its obligations under the Act and undertakes to provide a Modern Slavery Statement annually to the Minister of Home Affairs describing the risks of modern slavery in the operations and supply chains of the Linfox Armaguard Group and any actions taken to address those risks.

Linfox Armaguard is part of the Linfox Group, which also includes Linfox Pty Limited (ABN 59 004 667 298) and its wholly-owned subsidiaries, including Linfox Australia Pty Ltd (ABN 47 004 718 647) and Linfox International Group Pty Ltd (ABN 79 058 015 544), and their respective subsidiaries (together, Linfox).

Reporting Obligations

The first reporting period commenced on 1 July 2019 and concluded on 30 June 2020. Linfox Armaguard was party to Linfox’s inaugural Modern Slavery Statement, which was submitted to the Minister of Home Affairs on 31 March 2021 (Modern Slavery Statement).

Linfox Armaguard is committed to fulfilling its ongoing reporting and compliance obligations as described in its Modern Slavery Statement.

In order to combat modern slavery, Linfox Armaguard will continue to identify and assess those areas of its business that are most exposed to modern slavery, either by size of expenditure or risk.

The Modern Slavery Statement contains the following information pertaining to Linfox Armaguard and its related bodies corporate:

  1. Identification of the reporting entity and its related entities, including those it owns/controls.
    The Modern Slavery Statement lists all of the Australian Linfox Group entities as defined within the meaning of the Act, including their Australian Business Numbers.
  2. The structure, operations and supply chains of Linfox.
    We have provided a broad organisational outline, setting out the structure and divisions of the applicable Linfox Group entities.
  3. The risks of modern slavery practices in the operations and supply chains of Linfox Armaguard and any entities that it owns or controls.
    Linfox Armaguard operates in Australia, New Zealand and Thailand and has direct supply chains from its clients, customers and suppliers both nationally and internationally. The Modern Slavery Statement reports on the perceived modern slavery risks in its operations and supply chains including for the entities it owns or controls in Australia and internationally.
  4. The actions taken by Linfox Armaguard and any entity that it owns or controls, to assess and address those risks, including due diligence and remediation processes.
    The Modern Slavery Statement describes the processes of assessing risk and exposure of the businesses of Linfox Armaguard to understand where modern slavery risks may exist. Information has been and continues to be collected from across the group so as to complete our understanding and perspective of risks and existing controls and to capture any gaps.
  5. How Linfox Armaguard assesses the effectiveness of such actions.
    The Modern Slavery Statement identifies the processes implemented to assess and evaluate the risks of modern slavery within our workforce and supply chain and a roadmap for continuing to review and improve the success of the measures adopted.
  6. The process of consultation with any entities that Linfox Armaguard owns or controls.
    Linfox Armaguard , was party to the Joint Statement submitted on behalf of the Linfox Group. This group approach ensures that processes, including onboarding, procurement processes and education and training, are implemented consistently across all Linfox group entities. All employees and subcontractors will be made aware of and have access to the Modern Slavery Statement and will receive training to inform and educate them of the risks surrounding modern slavery.
  7. Any other information that Linfox Armaguard considers relevant.
    Linfox’s assessment for its Modern Slavery Statement implemented a risk-based approach. This involved focusing its efforts on areas assessed as having a higher risk of modern slavery practices such as those with high spend, and where the supply chain includes low-cost manufacturing countries.

Modern Slavery Statement Register

A joint Modern Slavery Statement has been prepared and submitted on behalf of Linfox, Linfox Armaguard and the entities it owns and controls for the purposes of the Corporations Act 2001 (Cth) to ensure consistency in the approach and attitude adopted across the Group.

A copy of Linfox Armaguard’s Modern Slavery Statement will be made available for public inspection on the Minister’s Modern Slavery Statements Register which will ensure openness and accountability in our business practices.

The Statement will be distributed and made available to all employees at the time of publication through the intranet and communications will be sent to all employees alerting them to the publication of the Statement and providing access to copies. Linfox Armaguard will also ensure copies are made readily available to its contractors, customers and suppliers.

Communication, Awareness and Training

To ensure Linfox Armaguard employees and subcontractors are aware and educated of the nature and risks of modern slavery in the workplace, our modern slavery guidelines and policy will be published and distributed to all Australian employees who will also be able to access copies of these documents via the intranet.

We are committing to ensuring all of our employees are aware of the existence of modern slavery risks and the methods of identifying, addressing and preventing such risks within our business.

Our senior managers will be educated on the risks of modern slavery arising, directly or indirectly, out of our supply chain and will be trained in identifying risks and implementing methods of prevention modern slavery through toolbox talks and presentations, which will then be provided to our employees. In the event they have any questions or queries in relation to our modern slavery policy, employees will have access to their branch managers and supervisors directly as well as being able to access our Linfox Armaguard Secure Future email account.

We are dedicated to avoiding any human rights harm arising out of our business practices, either directly or indirectly, and will refer to and rely upon the UN Guiding Principles on Business and Human Rights to assist us in preparing our training materials and documents and preventing any business-related human rights harm.

This policy will also be available to any customers and suppliers and the Modern Slavery
Statement will be published online for access by the public.

References - Legislation

  • Crimes Act 1914 (Cth)
  • Criminal Code Act 1995 (Cth)
  • Fair Work Act 2009 (Cth)
  • Migration Act 1958 (Cth)
  • Modern Slavery Act 2018 (Cth)
  • Modern Slavery Act 2018 (NSW)

References – Policies

  • Modern Slavery Policy
  • Workplace Behaviour Policy
  • Grievance Policy
  • Conflict of Interest Policy
  • Modern Slavery Statement FY2019-2020
  • Anti-Corruption and Bribery Policy
  • Whistleblower Protection Policy
  • Fraud and Corruption Control Policy
  • Code of Conduct (The Linfox Way)
  • Enterprise agreements, awards, collective agreements
  • Recruitment and selection policies and standards
  • Supplier and subcontractor management policies and systems

Contacts and Additional Information

If you would like further information in relation to this policy, please contact Liza Grage-Perry: liza.grage-perry@linfoxag.com

 

Modern Slavery Statement FY2019-2020

Introduction

The Modern Slavery Act 2018 (Cth) (the Act) defines ‘modern slavery’ as including eight types of serious exploitation: trafficking in persons; slavery; servitude; forced marriage; forced labour; debt bondage; deceptive recruiting for labour or services; and the worst forms of child labour. The worst forms of child labour mean situations where children are subjected to slavery or similar practices or engaged in hazardous work*1.
Linfox Pty Limited (ABN 59 004 667 298) and its wholly-owned subsidiaries, including Linfox Australia Pty Ltd (ABN 47 004 718 647), Linfox Armaguard Pty Ltd (ABN 83 099 701 872) and Linfox International Group Pty Ltd (ABN 79 058 015 544), and their respective subsidiaries (together, Linfox) is committed to sourcing products and services in a transparent, ethical and responsible manner. Linfox has a zero-tolerance approach to modern slavery. It is committed to acting with integrity in all business dealings and relationships and to implementing and enforcing effective systems and controls to assess and manage modern slavery risks.
This is Linfox’s first modern slavery statement. It details the steps Linfox has taken to assess modern slavery risks within its operations, inclusive of its supply chain, and the actions being taken to help address these risks into the future.

Linfox company, operations, and supply chain

Linfox is Asia Pacific’s largest privately-owned logistics company, incorporated and headquartered in Melbourne, Australia. The group has operations and offices in nine countries, and a workforce of more than 15,500 people, across operations in Australia, New Zealand, Thailand, Hong Kong, India, Indonesia, Laos, Malaysia and Vietnam.
Linfox is one of Australia’s largest providers of logistics services including distribution centre management, shared warehousing capability, integrated property warehousing, transport management, specialised industrial transport and retail transport.
Linfox also delivers supply chain solutions to retail, fast moving consumer goods, resources, and industrial sectors across Asia.
Linfox offers secure cash and valuables logistics, currency supply chain and technology solutions via its subsidiary, Linfox Armaguard. Armaguard is an iconic Australian brand with over 80 years’ experience developing processes and systems that provide currency forecasting, management and processing, along with technology solutions and other security services to a growing number of customers, including major banks and retailers. It is the market leader in Australian currency management.
Linfox-owned BevChain provides tailored supply chain solutions for the beverage industry, consolidating products from some of Australia’s favourite brands for distribution.
Linfox provides supply chain and logistics solutions for a range of industries including food, beverages, healthcare and pharmaceutical, government, defence, industrial, resources and retail as well as cash management and precious cargo.
For more than 65 years, Linfox has offered a broad range of logistics solutions, backed by a 200-strong warehouse network and extensive fleet capability including: road freight, rail freight, airfreight; bulk liquids and haulage, cross border logistics, dangerous goods, intermodal and cold chain logistics.

Linfox supply chain

Linfox’s supply chain includes the procurement of goods and services from over 5,000 active suppliers. Linfox’s procurement expenditure for the period 1 July 2019 – 30 June 2020 was approximately $2 billion.
Linfox’s procurement arrangements for the reporting period include acquisition of products and services such as logistics subcontractors, agency labour, trucks and armoured vehicles (and related parts and components), fuel, tyres, safety equipment, IT equipment, personal equipment and clothing (uniforms), stationery, cleaning, wrapping/packaging and hardware, software, communications and servicing for/of ATMs, Smart Safes, cash recycling equipment, deposit kiosks and parking meters.
Approximately 90 per cent of the Linfox procurement expenditure was made by the Australian and New Zealand entities, and the remainder spent in the other countries (mentioned above) in which Linfox operates. Despite the majority of its suppliers being located in Australia, Linfox recognises that its suppliers are likely to have acquired products and componentry manufactured elsewhere in the world, which presents modern slavery risks deeper within the supply chain.

Risks of modern slavery in operations and supply chains

Recognising the prevalence of modern slavery and the global nature of logistics and supply chain solutions, Linfox acknowledges that modern slavery practices may be present in its operations and supply chains.
Linfox is committed to fostering and maintaining a reputation based upon loyalty, integrity, fairness and trust, also known as the LIFT values. This requires the highest ethical practices and standards to be observed across its operations and supply chains. This commitment is captured and operationalised by The Linfox Way, which explains the Code of Conduct and the standards of behaviour expected by everyone that works for Linfox.
Linfox integrates human rights considerations, including combatting modern slavery, into its risk management processes. The following practices, policies and procedures contribute to the efforts to combat modern slavery across the group:

  • Modern Slavery Policy
  • Workplace Behaviour Policy
  • Grievance Policy
  • Conflict of Interest Policy
  • Anti-Corruption and Bribery Policy
  • Whistleblower Protection Policy
  • Fraud and Corruption Control Policy
  • Code of Conduct (The Linfox Way)
  • Enterprise agreements, awards, collective agreements
  • Recruitment and selection policies and standards
  • Supplier and subcontractor management policies and systems.

Assessing modern slavery risks

Linfox has conducted a high-level risk and exposure assessment of its businesses to understand where modern slavery risks may exist. The assessment was undertaken by a cross-functional team across procurement, legal and risk. Information has been and continues to be collected from across the group so as to complete our understanding and perspective of risks and existing controls and to capture any gaps.

The assessment involved a desktop review of Linfox’s quantifiable spend on its supply chain. Higher-spend suppliers were then categorised and assessed as high, medium, or low risk for modern slavery practices based on the eight exploitative practices (as per UN and Australian Government definition of modern slavery). Any potential exposure to exploitative practices were further assessed according to ‘reported high risk industry’, ‘commodity’ and/or ‘country where these exploitative practices frequently occur’.
Linfox’s suppliers assessed as moderate or high risk were reassessed on factors including their modern slavery responses, country of origin clarification and commercial relationships that support fair employee pay.
The assessment found that the risks were largely dependent on geographical location, with higher risks linked to low cost manufacturing countries where there are greater safety and security issues, political unrest and corruption.

Risks in Linfox operations

Approximately two thirds of Linfox employees are based in Australia and New Zealand, and around 90 per cent of Linfox suppliers are Australian entities.
Linfox engages subcontractors for vehicle transport, rail operations and other security services (such as guards, cash-in transit subcontractors or locksmiths) either directly with drivers or by engaging other logistics or security companies. Linfox also has labour hire agreements with a panel of providers for labour in warehouses and distribution centres, and uses software consultants to support its in-house information technology resources.

Subcontracted labour across all operations (such as contracted drivers and agency-based cleaning staff) may expose the company to sham contracting and deceptive recruiting for labour and services. There is a higher risk where the supplier has an international footprint and can recruit from, or outsource to, low cost countries.

Linfox’s contractual agreements with subcontractor drivers include modern slavery requirements. They are recorded and monitored through its subcontractor onboarding and management systems. Linfox’s specialist rail operations provider is a large Australian company with a modern slavery statement. Labour hire agreements with all providers refer to both modern slavery laws and compliance with Linfox’s Modern Slavery Policy. Linfox has assessed the risk of exploitation by driver and rail subcontractors as low.

Cleaning services are highlighted as a risk industry for exploitation in Australia: individuals from Asia and Pacific Islands may be recruited to work temporarily in Australia in cleaning roles. Linfox initially assessed this as a moderate risk. A single provider is responsible for over 80 per cent of spend, which is an Australian company and has a modern slavery statement. Following a further review this risk has been reassessed as low.

Risks in the supply chain

Linfox has a network of suppliers across a range of goods and services. Linfox is aware that the risks of modern slavery may be exacerbated in businesses that rely on extensive contracting and subcontracting arrangements.

As well as the subcontracted activities discussed above, Linfox’s major spend categories are related to the purchase and maintenance of the vehicle fleet - vehicles, parts and spares, fuel, tyres – and consumables for logistics operations - packing supplies and materials, stationery, and uniforms and safety equipment.

Global manufacturing practices, even via local suppliers, exposes Linfox to sourcing exploitation risks from low cost manufacturing countries that may have poor working conditions. Areas of concern are:

  • Forced/bonded labour
  • Deceptive recruitment
  • Exploitation of migrant workers
  • Child labour
  • Underpayment of wages
  • Excessive working hours.

Linfox assessed the following high-value direct suppliers relevant to the 2019-20 financial year.

Vehicles

Linfox purchases a range of different vehicles for its large fleet. Maintaining the Linfox fleet requires parts, spares and consumables. These items are sourced from the manufacturer or original equipment manufacturer (OEM).

These are sourced from major manufacturers who have provided detailed modern slavery statements.

This category of spending has been evaluated as low risk.

Fuel

As a logistics provider with a large fleet, Linfox purchases fuel for its vehicles. The petroleum industry has had a history of exploitative practices, in drilling, refining or logistics*2. Moderate risks of forced labour, slavery of children, and low-cost country sourcing were initially assessed in the fuel supply chain. In Australia, forced labour includes the exploitation of workers (especially migrant or student workers) in the payment of wages and hours worked in retail fuel locations - the franchising of fuel stations increases this risk. An initial assessment of the risk in fuel supply rated it as low to moderate.

Modern slavery statements were provided by Linfox’s two suppliers. Both suppliers are aware of the exploitative risks related to their global supply chains and are implementing mitigation activities. Linfox fuels vehicles at its own depots and at retail fuel stations. The majority of retail fuel stations (by volume) that Linfox uses are owned and managed by the fuel companies rather than franchisees, and so have been re-evaluated as low risk.

Tyres

As a logistics provider with a large fleet, tyres are a material spend, covering both vehicle and manual handling equipment tyres. The majority spend is with preferred brands: two suppliers are responsible for over 90 per cent of spend.

The tyre industry is the main consumer of natural rubber and is a large consumer of soybean oil used to replace petroleum products. The rubber and soybean commodities have been highlighted for exploitative risks in multiple US Government reports*3.

Linfox’s manufacturers of tyres have sites in low manufacturing cost countries including South Africa, Mexico, China and India. Some manufacturing is carried out in the United States.

The tyre supply chain was initially assessed as high risk. Linfox’s two main suppliers operate globally and have provided detailed modern slavery statements to meet legislative requirements in the United States and the United Kingdom. Both major manufacturers are aware of the exploitative risks related to the commodities used and low-cost sourcing countries and are implementing mitigation policies. Linfox has therefore reduced the assessed risk to low/moderate.

Linfox also assessed suppliers with exposure in their supply chains to low cost manufacturing countries. Global sourcing, even via local companies, presents the risk of exploitation: labour rights and working conditions are considered a high exploitation risk in these countries.

Packaging supplies and materials

Linfox purchases packaging supplies and materials to support logistics operations. This includes plastic films and stretch wrap, labels, adhesive tapes and strapping.

The majority of this spend is with five suppliers, one of whom has provided a modern slavery statement. Although most suppliers are Australian, it is very likely that materials are manufactured globally. The risk has been assessed as low to moderate.

Stationery, safety equipment and uniforms

As well as traditional office supplies like paper, Linfox’s stationery spend includes labels and seals for packages. A single supplier is responsible for over 75 per cent of spend, and the supplier advises material is sourced from China. The remaining 25 per cent is spread across over 70 low value suppliers, with items sourced locally but manufactured globally. The modern slavery risk was initially assessed as moderate, but a modern slavery statement was provided by our main supplier and so this rating has been reassessed as low to moderate.

Personal protective equipment (PPE) and safety equipment are listed as one of the main industries at risk of exploitation in China*4. This category has multiple suppliers, but one supplier is responsible for over 50 per cent of spend. Most of these suppliers are local, but the items are manufactured globally. Safety wear/uniforms are a major component of the spend and Linfox’s Procurement team has found this is predominantly sourced from manufacturers in China. The risk associated with safety equipment was initially assessed as high; however, Linfox’s main supplier provided a modern slavery statement and so this area was reassessed as low to moderate.

Uniforms are also sourced from manufacturers in China; 95 per cent of the spend on uniforms is through a single supplier. An initial assessment of moderate to high was revised to low to moderate after Linfox’s major supplier provided its modern slavery statement.

Managing modern slavery risks – the road ahead

Linfox has commenced its program to combat modern slavery by identifying and assessing those areas that are most exposed to modern slavery, either by size of expenditure or risk. Linfox is committed to continuing to develop its understanding and management of modern slavery risks in its operations and supply chain.
Continue to incorporate modern slavery into Linfox’s risk management and compliance framework

Linfox will:

  • Periodically review its Modern Slavery Policy to ensure that the policy remains consistent with all relevant legislative requirements as well as the changing nature of the company.
  • Continue to incorporate the requirements of its Modern Slavery Policy in its other policies and procedures as they are reviewed and updated.
  • Provide knowledge and awareness of the risks of modern slavery in the requirements for relevant roles.
  • Update induction programs and onboarding practices.
  • Continue engaging with suppliers to improve Linfox’s understanding of modern slavery risks deep in the supply chain.
  • Monitor the effectiveness of controls against modern slavery risk, including compliance with the Modern Slavery Policy and any relevant procedures.
  • Report material modern slavery risks to leaders, the Executive Leadership Team and the Board Risk Committee through Linfox’s risk management framework. Management teams will also report to the Boards if there are any material incidents and/or allegations of modern slavery in its operations or supply chain identified or disclosed during the year, and any steps taken to respond.
  • Update Linfox’s whistleblower process to incorporate anonymous reporting of modern slavery issues.

Incorporate modern slavery risk into procurement decisions

Linfox will:

  • Continue to update its procurement processes to ensure they align with Linfox’s commitment to human rights and the LIFT values.
  • Continue to improve modern slavery engagement with existing suppliers by the development of a Supplier Code of Conduct, prioritising those suppliers considered high risk, high value or strategically important.
  • Identify and assess human rights and modern slavery risks during tenders and other means of evaluating new or renewing suppliers and subcontractors. Linfox will consider these risks as a factor in evaluating the suitability of suppliers.
  • Contractually bind suppliers and subcontractors to comply with applicable employment and workplace laws and regulations, including labour and child labour laws. Linfox will have the right to audit and enforce these requirements.

More comprehensive assessment

Linfox’s assessment for this statement took a risk-based approach. This involved focusing its efforts on areas assessed as having a higher risk of modern slavery practices such as those with high spend, and where the supply chain includes low cost manufacturing countries.

Linfox recognises that it currently has limited visibility over some of its suppliers, particularly those further along the chain of supply. Linfox acknowledges that it is still developing its capacity to systematically identify and respond to modern slavery risks across its supply chain.

In the next year, Linfox will extend its modern slavery risk assessment. Linfox will review the approaches to managing modern slavery risks from the top five suppliers in each spend category, and more closely review sourcing arrangements for risks deeper in the supply chain.

Approval

Linfox acknowledges that modern slavery can occur in every industry and sector and has severe consequences for victims. Linfox is committed to operating to the highest ethical practices and standards, and to addressing and managing modern slavery risks in its supply chain in accordance with this statement.
The Linfox Board of Directors authorised and approved the publication of this statement.

Peter Fox
Executive Chairman
Linfox Pty Ltd

 

*1 Commonwealth Modern Slavery Act 2018: Guidance for Reporting Entities, Pt 1, Overview: p 8
*2 Source: BP Slavery and human trafficking statement 2019 dated June 2020
*3 “Trafficking in Persons Report”, U.S. Department of State 2018; “List of Goods Produced by Forced Labour and Child Labor”, U.S. Department of Labor (DOL)
*4 US Responsible Sourcing Tool, www.responsiblesourcingtool.org

 

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