As an Australian entity with an annual consolidated revenue of more than $100 million, QIC is required to report on the risk of modern slavery across its investment activities and portfolios, as well as through its operations and procurement supply chains under the Modern Slavery Act 2018 (Cth) (‘the Act’).

QIC’s approach to modern slavery is managed at the corporate level and is focused on continuous improvement. During the reporting period, actions across QIC included:

• building further capability across QIC, providing targeted education to investment teams 
• updating our risk assessment approach, incorporating additional resources to identify the highest risk activities, and how we prioritise our efforts within investment teams 
• commencing the development of a tool to improve the ability of our procurement officers to identify high risk suppliers, and enhance the guidance for due diligence as part of a wider ESG procurement integration project 
• implementing improvements to the way we classify and track claims and accusations of modern slavery with our critical suppliers and investee companies
• increasing our industry participation by joining the United Nations Global Compact Network Australia and Investors Against Slavery and Trafficking. 

At QIC, we manage diverse asset classes and products on behalf of our clients, and we have different levels of ownership in, and influence over, our investments. Due to this, while our Modern Slavery Framework is consistent, our approach to meeting our obligations under the Act varies across asset classes and investment teams.

Assessing and managing modern slavery within QIC's Real Estate investment team

QIC Real Estate’s ESG strategy, through the Sustainable Value Chain focus area, works to address modern slavery risk in our operations and supply chain. We acknowledge the potential link between our asset related activities and areas of elevated modern slavery risk, and are committed to continuously improving our efforts to address the risk of modern slavery.In addition to the QIC corporate level initiatives, we have continued to progress the following activities within our Real Estate business during FY24.

Assessing Risk

Using the Fair Supply⁶³ platform, QIC Real Estate's supplier spend for CY23 was analysed and the modern slavery risk of our supplier industry categories mapped across 10 tiers of supply chain. The most significant modern slavery risks within our supply chain relate to our real estate development projects due to the potential modern slavery risks associated with construction activities, and the operations of our shopping centres due to the risks associated with commercial services and suppliers (including cleaning contractors and security services). 

Based on the supplier analysis, 128 of QIC Real Estate’s highest risk suppliers were invited to complete or update their previous year’s responses to the Property Council of Australia’s Modern Slavery Supplier Platform questionnaire (‘Questionnaire’) in May 2024. 

The Property Council of Australia’s  Modern Slavery Supplier Platform is now supported by 44 of our property industry peers. It was established to lessen the reporting burden of suppliers to the property industry by asking them about the actions they are taking to address human rights and modern slavery risks across their operations and supply chains on a single questionnaire and platform. The Questionnaire response rate for QIC Real Estate’s suppliers was 54% (69 suppliers), which is above the average response rate across the broader platform. 51 suppliers completed the Questionnaire in both this reporting period and the prior reporting period (FY23).

Responses to the Questionnaire have been assessed and demonstrate a slight improvement in some areas of our suppliers’ understanding and approach to modern slavery over the past year. The responses have also enabled us to identify areas where our suppliers’ approaches have not improved, and where we are able to provide them further support to help progress their approach to addressing modern slavery, which will be implemented during FY25. This will include directly engaging with 10% of Tier 1 high risk suppliers to support them in their approach to addressing modern slavery, a strategic objective for FY25 under our ESG strategy. This presents an opportunity to lift the maturity in managing modern slavery risks within our supply chain.

Cleaning Accountability Framework (CAF)⁶⁴: We continued our active participation with CAF during the reporting period, and obtained CAF certification at five additional assets across the Real Estate portfolio: Canberra Centre (ACT), Watergardens (VI), EastCo⁶⁵ (VIC), Westpoint (NSW) and Hyperdome (QLD).

Our three existing CAF certified assets – Robina Town Centre (QLD), Castle Towers (NSW) and Eastland (VIC) – each successfully completed an independent ‘health check’ process undertaken by CAF during the Reporting Period to ensure ongoing compliance with the CAF standard. We now have a total of eight QIC Real Estate assets CAF certified at 30 June 2024 as listed in Table 14.

Table 14: CAF certified QIC Real Estate assets

Four additional QIC Real Estate assets also commenced the CAF certification process during the reporting period, which are due for completion in early FY25.

Supplier due diligence: Due diligence continued to be undertaken to assess the risks of proposed new supplier relationships based on the nature of the goods or services being purchased, and their value. If suppliers sit in a higher risk category, further due diligence is completed to assess their policies and practices. An example is our engagement of solar panel installation suppliers for our assets. We recognise that solar panels remain a high risk within our supply chain, and we may be directly linked through the suppliers we engage. While no new solar suppliers were onboarded during the reporting period, our standard process is to perform due diligence on all new suppliers to understand their policies and procedures and supply chain due diligence processes, which includes a focus on investigating possible supply chain linkages to Xinjiang in China. Recognising that the risk of modern slavery occurs at deeper tiers within this highly complex supply chain, we are committed to continuing to increase our understanding of these risks.  

Tender evaluation: Our tender process includes ESG criteria, including modern slavery questions to ensure human rights are given proper consideration during due diligence, the establishment of contracts and ongoing supplier relationship management. Our internal purchasers perform due diligence and assess the risks of proposed engagements based on the nature of the goods or services being purchased and their value.

Supplier contractual clauses: Supplier contracts continue to include a standard clause that specifically addresses modern slavery. Where QIC Real Estate suppliers have been identified as being at a higher risk of modern slavery, additional contractual obligations may be incorporated in the contract.

Training: In addition to the mandatory firm-wide Modern Slavery Awareness training delivered across QIC, during FY24 live online modern slavery training sessions catered to our Real Estate employees with responsibility for managing suppliers were developed and delivered by Robin Mellon, CEO of Better Sydney. The training was specifically developed for different areas of the Real Estate business to ensure it was relevant for all participants.

QIC Real Estate’s Community Manager participated in the six-month UN Global Compact Business and Human Rights Accelerator training program.

Collaboration with the property industry to address modern slavery risk: QIC Real Estate became a member of the Property Council of Australia’s  Human Rights and Modern Slavery Working Group in July 2023, to collaborate on the assessment and management of modern slavery risk across Australia’s property and construction sector.

We also continued our membership to the Informed 365 Modern Slavery Property Supplier Platform Working Group whose members use the Property Council of Australia’s  Modern Slavery Supplier Platform to assess and address modern slavery risk in their supply chain. This group meets monthly to identify opportunities to continuously improve the platform, analyse supply chain data and identify where supplier engagement and education might be beneficial.

Tenants: We recognise there are modern slavery risks across the retail sector that have the potential to relate to tenants at our shopping centres. As a first step to address this risk, we continue to integrate modern slavery clauses into leasing contracts where possible.

During the reporting period, QIC did not become aware of any actual or suspected incidences of modern slavery in our supply chains or operations.

For more on QIC's approach to Modern Slavery, see our latest Modern Slavery Statement.

⁶⁵ EastCo is a commercial office building which is part of the precinct adjoining Eastland.

During the reporting period we engaged sustainability consultancy Edge Impact to undertake a review to provide us with a more granular view of ESG related risks across our Real Estate supply chain. The work is focused on identifying specific supplier categories and associated materials, services and consumables that present higher risk likelihood across Green Star and ISO20400 aligned ESG topics, including modern slavery. This assessment will be completed during FY25 and used to further embed solutions into our procurement, due diligence and supplier engagement processes, enabling us to focus our efforts on suppliers within categories found to be higher risk.