Canada’s S-211 Act: A New Era for Supply Chain Transparency
Supply chain accountability is no longer just a best practice—it’s now a legal requirement for many Canadian businesses. With the introduction of Canada’s Modern Slavery Act (S-211), companies must actively address the risks of forced and child labour in their supply chains, ensuring greater transparency and ethical practices.
For businesses with annual revenues over $20 million, S-211 introduces mandatory reporting requirements to eliminate exploitative labour practices. While compliance may seem challenging, it also presents an opportunity to enhance reputation, gain a competitive edge, and demonstrate ethical leadership in a socially conscious market.
This guide breaks down what S-211 means for your business and how to navigate its requirements effectively.
What is Canada’s Modern Slavery Act (S-211)?
Canada’s S-211 legislation enhances corporate accountability by requiring businesses to identify and address risks of forced and child labour across their supply chains. Unlike earlier regulations focused solely on disclosure, S-211 mandates concrete actions and annual reports to ensure transparency and accountability.
Who Must Comply with S-211?
S-211 applies to organizations meeting any of the following criteria:
- Annual revenues of $20 million or more.
- Assets of $20 million or more.
- Listed on a Canadian stock exchange.
Covered businesses must submit annual reports detailing policies, risk assessments, due diligence processes, and remediation measures for labour exploitation. Senior executives must sign off on these reports, ensuring accountability at the highest level.
This legislation aligns Canada with global standards, such as the UK’s Modern Slavery Act and Australia’s Modern Slavery Act 2018. However, compliance can be complex for multinational companies with overlapping obligations.
Globally, 27.6 million people remain trapped in forced labour, with 63% of cases occurring in the private sector. S-211 aims to combat these exploitative practices and drive meaningful change in supply chains.
What Does Compliance Look Like?
To meet S-211 requirements, businesses must address the following areas in their annual reports:
- Organizational Structure & Supply Chains: Map supply chains, including supplier relationships, geographic locations, and high-risk sectors.
- Policies & Due Diligence: Outline actions such as supplier agreements, monitoring processes, and training to prevent forced and child labour.
- Risk Assessments: Identify and update exploitation risks using systematic methods.
- Remediation Measures: Highlight steps taken to address risks, such as corrective action plans and progress tracking.
- Socioeconomic Impact: Consider potential impacts, such as financial challenges for families affected by the removal of child labour.
- Employee Training: Develop tailored programs to help employees identify and mitigate risks.
- Effectiveness of Measures: Provide metrics and evidence to demonstrate progress in tackling exploitative practices.
For practical support, the International Labour Organization (ILO) offers resources to help organizations address forced labour risks and implement ethical practices.
Risks of Non-Compliance
Failing to comply with S-211 can lead to severe consequences, including:
- Financial Penalties: Non-compliance can result in fines of up to $250,000, significantly impacting profitability.
- Reputational Damage: Public trust can erode, with 73% of millennials willing to pay more for sustainable products.
- Lost Market Share: Companies may be excluded from public contracts or procurement processes for failing to meet ethical standards.
- Investor Concerns: ESG (Environmental, Social, and Governance) factors influence investment decisions. 79% of investors say they factor ESG risks and opportunities into their investment decisions.
- Operational Disruptions: Issues with non-compliant suppliers can lead to production delays, increased costs, and business interruptions.
By proactively addressing these risks, organizations can protect their operations, maintain customer trust, and build a strong reputation.
The Role of Training in Compliance
Training is critical for meeting S-211 requirements. Effective programs:
- Tailor content to specific roles, such as procurement or leadership.
- Provide practical tools like risk assessment templates and supplier monitoring checklists.
- Offer ongoing updates to reflect changing risks and regulations.
How GPSI Can Help
At GPSI, we offer customized training programs to help Canadian businesses comply with S-211. Our solutions include in-depth workshops, online courses, and tools like risk mapping templates to ensure your team is prepared. As an EcoVadis-approved training partner, we integrate sustainability insights to align compliance with ESG goals.
Training is available in both English and French, making it accessible to teams nationwide.
Embracing Compliance as a Competitive Advantage
S-211 is more than just a legal requirement—it’s an opportunity. By addressing supply chain risks, businesses can strengthen their reputation, build trust, and lead in responsible business practices. Proactive compliance not only ensures adherence to the law but also fosters long-term resilience and growth.
Ready to take the next step? Contact GPSI today to explore how our training solutions can help your team achieve S-211 compliance and build a more ethical supply chain.
