Prime Minister Tony Abbott has urged Commonwealth leaders to engage and not isolate countries such as Sri Lanka as they emerge from civil strife.
Mr Abbott, Prince Charles and Sri Lankan President Mahinda Rajapaksa delivered opening ceremony addresses to kick off the Commonwealth Heads of Government Meeting in Colombo on Friday.
The summit was mired in controversy after the leaders of Canada, India and Mauritius - the next host country - boycotted it over concerns about Sri Lanka's human rights record after almost three decades of civil war.
Mr Abbott instead urged a "spirit of encouragement, not isolation".
"Sri Lanka's willingness to host this Commonwealth shows its commitment to democratic pluralism and freedom based on law and ought to assure all its citizenship that just as today is better than yesterday, tomorrow will be better than today," Mr Abbott said.
Mr Rajapaksa's government faces global calls for an independent inquiry into alleged human rights breaches and atrocities in the dying months of the war.
Mr Abbott said the peace achieved in Sri Lanka had brought more freedom and prosperity.
"So we are here to praise as much as to judge," he said.
The Sri Lankan president launched a passionate defence of his country's new era of "peace, stability and renewed economic opportunities".
"We asserted the greatest human right - the right to life," he said of how the civil war was brought to an end.
Prince Charles, standing in for the Queen, who is scaling back her international travel, said the Commonwealth was about creating a better future.
"Each one of us is here because of the hope and the trust we place in the Commonwealth to bring that touch of healing to our troubles and deliver the very best future for our people," he said.
Mr Abbott met with British Prime Minister David Cameron and plans bilateral meetings with the leaders of Nauru and Pakistan during the summit, which ends on Sunday.
Human rights advocates say Mr Abbott is toning down his criticism so as not to jeopardise a potential deal with Sri Lanka on stopping people-smuggling.
"So far Australia has forcibly returned well over 1000 Sri Lankans," Emily Howie, of the Human Rights Law Centre, told AAP.
"Australia is failing human rights on two levels: we are failing to speak up for the protection of Sri Lankans' rights and we are doing so in order to cruelly and unlawfully return them to Sri Lanka."
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