A new report has found Australian companies could be failing to protect the rights of overseas workers by not having a clear labour and human rights policy.
The report comes as an investigation whilst working in sweatshops used by some of Australia's best-known retailers.
It also comes just months after international outcry over the tragic building collapse in Rana Plaza, which killed more than 1,000 people and highlighted the plight of the nation's garment workers.
The three-part study by the Australian Council of Superannuation Investors (ACSI) explored the sourcing patterns of 34 Australian companies.
It found that more companies are now using lower-skilled and lower-wage workers in developing Asian countries.
Imports from Bangladesh increased 15-fold between 2006 and 2012, while imports from Cambodia rose six-fold and Vietnamese imports increased 2.7-fold.
The ACSI report warns that shifting to poorer markets heightens the risk of dodgy labour practices and human rights abuses occurring at some stage of the supply chain.
It says the deadly collapse of the Rana Plaza should serve as a "tragic reminder" of rights issues within the industry.
More transparency needed
However, the council says retailers are doing little to find out about and and analyse the rights of overseas workers.
The report found that of the 34 companies investigated, 62 per cent did not have a publicly available policy addressing labour and human rights policy for its supply chain.
Only one-third had child and forced labour policies.
"The emerging risks in supply-chain labour and human rights have profound implications for long-term shareholder value," ACSI chief Ann Byrne said in a statement.
"Current disclosure levels by Australian companies, especially those in highly-exposed industries like retail clothing and food, are simply not good enough.
"Ultimately this threatens the long-term performance and stability of the companies and poses a real threat to institutional investors such as superannuation funds.
"ACSI will be pursuing dialogue with company boards about risk management and disclosure on labour and human rights."
Australians 'would pay more to ensure worker safety'
Meanwhile, a survey by not-for-profit aid organisation Oxfam shows almost 70 per cent of Australians would pay more for their clothes if it meant workers were given an acceptable wage and worked in safe factories.
In addition, 84 per cent of Australians who took part in the survey say they want Australian companies to sign onto an accord to ensure safety standards are improved in Bangladeshi factories.
Oxfam Australia chief Helen Szoke says only three Australian companies – Kmart, Target and Forever New – have signed onto the safety accord.
"European and American companies are already being transparent about where their garments are produced so why is it different for Australian companies, why can’t they do the same?" she said.
"The devastation caused by the factory collapse has prompted many Australians to think twice about where their clothes come from.
"Our research shows consumers want Australian retailers to prevent further tragedies by taking greater responsibility and looking after the thousands of workers who make the clothes we wear every day."