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Article
27 Feb 2024
Author:
M. Streibelt, D. Schönfelder, C. Bright et al., Nova Centre on Business, Human Rights and the Environment Blog (EN) / M. Streibelt & D. Schönfelder, Haufe Sustainability (DE)
Common rules for the common market – the CSDDD is needed for businesses and human rights
The Corporate Sustainability Due Diligence Directive (CSDDD) is on the Council’s agenda for this week, which might be one of the last chances for the urgently needed directive to be adopted before the EP elections. There still seems to be a lack of understanding regarding the substantive arguments raised by some in criticism of the directive. Upon closer investigation, these arguments are based on an inaccurate understanding of the law. As professionals working with companies on how to implement human rights in their activities and supply chains, the authors of this text address them from a practical standpoint.
It is also worth remembering from the outset that, in the seminal study on due diligence through the supply chain, the vast majority of stakeholders (including notably businesses, civil society, academics and government officials) were in favour of the introduction of mandatory due diligence at the European level in order to identify, prevent and address the adverse human rights and environmental impacts that companies can have in their operations and throughout their global value chains. [...]
A bureaucracy monster, harmful to companies?
Some political parties and business associations have criticised the directive and alleged it would overly burden companies, especially SMEs. It has also been wrongly argued that the directive requires companies to guarantee that there are no potential or actual adverse impacts in their supply chain. That would indeed be impossible. However, a careful analysis of the directive shows that it does in fact not set forth such requirements. On the contrary, and in line with international standards in the field which impose an obligation of means and not an obligation of result, the directive simply requires companies to put in place due diligence processes which are appropriate to their size and influence, including the possibility to prioritize the most severe risks. [...]
Level playing field and uniform standard instead of patchwork legislation
The CSDDD would create a common standard for the common market of the EU. [...]
Withdrawal from difficult regions?
The CSDDD does not require European companies to withdraw from difficult at risk countries, regions, supply chains or suppliers. Instead, in line with international standards, the directive provides that termination should be used only as a matter of last resort and guarantee a responsible exit. [...]
Clear rules on civil liability create legal security
Among the most misleading claims in relation to the CSDDD is that companies will face unmanageable and unreasonable liability risks. In fact, it is quite the opposite since exercising appropriate human rights and environmental due diligence is actually the best way for companies to protect themselves from liability. As a result, by setting out requirements and clear expectations for companies in relation to due diligence, the CSDDD helps them address the liability risk. [...]
Corporate sustainability with or without the CSDDD
Whether or not the CSDDD is adopted, companies are already and will increasingly be subjected to expectations and requirements to put in place due diligence processes to ensure that they do not harm human rights and the environment in their operations and throughout their supply chains. [...]
90+ organisations urge EU leaders to protect the sustainability reporting framework, promoting smart implementation and providing the legal certainty companies need to thrive.
The ninth Human Rights Report of the German Institute for Human Rights covers topics such as the exclusion of people with disabilities in the labour market, exploitative working conditions for migrant workers and the human rights responsibility of companies.
The new guide by Forest Peoples Programme outlines how indigenous and forest peoples can use the EU Deforestation Regulation and the Corporate Sustainability Due Diligence Directive to address corporate-linked human rights violations and environmental harm.
Report from the Forest Peoples Programme reflects on the progress and ongoing challenges in integrating Indigenous and Forest Peoples' rights into EU law and policy. It highlights key legislative developments like the European Deforestation Regulation and the Corporate Sustainability Due Diligence Directive, while emphasising the need for greater consultation and action to protect these communities' rights amidst the green transition.
The 2024 Danish Institute for Human Rights benchmark assesses the human rights policies and due diligence practices of 30 major Danish companies, measuring their alignment with global standards and contributing to discussions on responsible business conduct and the impact of upcoming EU regulations.
A new report by the EIRIS Foundation, applying its Social LobbyMap methodology, examines and highlights the role of private sector influence in the exclusion of financial sector downstream value chain activities from the scope of the EU Corporate Sustainability Due Diligence Directive (CSDDD).
The ECCJ, in collaboration with 8 other CSOs, published a Transposition Guide for the Corporate Sustainability Due Diligence Directive (CSDDD). This essential guide provides key insights and recommendations for the upcoming transposition phase of this EU directive.
The ActionAid report highlights the need for a gender-responsive approach to the CSDDD, emphasizing the importance of addressing gender inequality, women’s rights, and protections for marginalized groups disproportionately affected by corporate abuses.
The report outlines recommendations for governments and companies to enhance corporate human rights performance through robust regulatory frameworks and collaborative efforts.
The study by the British Institute of International and Comparative Law provides reflections on changes in corporate practice resulting from the implementation of HREDD laws, namely the French DVL and German LkSG, and a comparative analysis of these legal models.
Anti-Slavery International's analysis of the EU CSDDD aims to empower civil society organisations to advocate for its effective implementation, address remaining gaps, and promote fair treatment of workers by businesses.
Trade unions are pushing for stronger human rights protections in the base metals sector, emphasising the role of HRDD frameworks and the CSDDD in improving worker conditions and holding companies accountable.
In its report, UNICEF provides its recommendations to the EU Institutions, EU Member States, and businesses on how to effectively implement the CSDDD for children’s rights.
The particular format of the sector dialogues has had some positive results, but on balance the overall result for civil society is rather patchy – this is the conclusion NGOs participating in those sector dialogues present in a new background paper. Attempts by companies to depict their activities in sector dialogues as stakeholder engagement must be viewed in a critical light against the background of the CSDDD and the German Supply Chain Act.
The guide provides an in-depth analysis of the CS3D Directive, offering recommendations for its transposition into national laws to ensure strong environmental protection while encouraging alignment with international standards and supporting lawmakers, public authorities, and companies in understanding and implementing its provisions.
Non-exhaustive examples showing how questions of effectiveness, current supply network/value chain complexity, and feasibility for companies have been addressed by the Corporate Sustainability Due Diligence Directive (CSDDD).
The guide provides practical guidance on how to engage with policymakers through the transposition of the Corporate Sustainability Due Diligence Directive to advocate for alignment with the UN Guiding Principles on Business and Human Rights and other international business and human rights standards.
Non-exhaustive examples on protections and opportunities for small and medium-sized enterprises (SMEs) from the Corporate Sustainability Due Diligence Directive (CSDDD)
The new blog by BSR says that financial institutions should proactively align with the CSDDD by assessing management gaps, enhancing collaboration, mapping value chains, identifying stakeholders, and developing a roadmap based on international due diligence standards.
Swedwatch views the CSDDD as a positive, long-awaited step towards corporate accountability but urges the Swedish government to strengthen the law during transposition, particularly by addressing gaps in company scope, downstream due diligence, and enforcement.
The author, lawyer Robert Grabosch, LL.M., explains what the EU Supply Chain Directive actually does and does not stipulate. Robert Grabosch also points out the serious differences from the
German Supply Chain Act.
This Policy Brief by the Responsible Contracting Project analyzes the content of the newly adopted EU Corporate Sustainability Due Diligence Directive with respect to commercial contracts.
More than 100 large companies, SMEs and networks including Maersk, Aldi Süd Holding, Cisco, Nokia, H&M Group, Scania and Ritter Sport have united to endorse the Corporate Sustainability Due Diligence Directive (CSDDD) again at the stage of final formal confirmation.
The CSDDD makes notable advances in mitigating the risk that in-scope companies simply “transfer” obligations to their business partners, explains Radu Mares in his contribution to the blog symposium hosted by Verfassungsblog and the German Institute for Human Rights.
In partnership with the German Institute for Human Rights, a blog symposium by Verfassungsblog explores the directive’s scope on human and environmental rights, its extraterritorial reach, the role of National Human Rights Institutions, accompanying measures for corporations, and delves into key issues such as access to justice for rightsholders, administrative oversight, and meaningful engagement with Global South stakeholders.
The CSDDD is the first region-wide due diligence legislation, yet it is also a political compromise among EU member states, which civil society and business have been watching closely. This piece explains the main elements of the CSDDD and outlines some of its implications beyond the EU.
Press release by the European Coalition for Corporate Justice along with an "Overview of the Corporate Sustainability Due Diligence Directive: Advancing Corporate Responsibility"
Human Rights Watch calls on voters in the EU election to see where candidates and parties on their ballot stand on speaking up against corporate abuses, enacting and expanding legislation to regulate corporations’ activities, and ensuring that affected people and communities have access to justice and remedies, among other topics.
This publication aims to give an overview of the various EU regulatory initiatives of relevance to business and human rights in force or under development by the EU, how they align with international frameworks, such as the UN Guiding Principles on Business and Human Rights, and how the various pieces fit in the puzzle.
The European Parliament has adopted new laws to rein in companies for human rights abuses in global supply chains. This will have far-reaching impacts on Switzerland’s largest companies.
This publication by the Danish Institute for Human Rights summarises the key elements of the CSDDD, considers steps for effective implementation, and recommends strategies for aligning with the UNGPs
Overview of business voice in support of mandatory due diligence, notably the EU's Corporate Sustainability Due Diligence Directive (CSDDD), since February 2024
Stéphane Brabant, Senior Partner at Trinity International AARPi, and Eugénie Denat, summarise the most essential provisions of the CSDDD in order to reassure businesses about the application of the directive and its content.
In this briefing, ECCJ, CAN Europe, Reclaim Finance, Frank Bold, ECCHR and ClientEarth address some of the main myths around the CSDDD and lay out the importance of this law in finally holding European corporations accountable.
The preliminary endorsement by member states of the Forced Labour Regulation ramps up pressure on wavering countries to also endorse CSDDD on Friday, reducing the political room to justify continued resistance to the law.
In March 2024, over 50 representatives from businesses including Ferrero, Mondelez Italia and Mars, associations and NGOs, urged the Italian Government to support the CSDDD ahead of another - and potentially the last - chance to secure EU Council endorsement. This statement joins a chorus of voices from across large and small businesses, associations, academia, and civil society in support of the CSDDD.
EU negotiators went back to the drawing board over the weekend to bulletproof the text of the bloc’s corporate due diligence law (CSDDD) in the hope of securing a final deal by Friday (15 March) at the latest, Euractiv understands.
Failure to agree an ambitious EU Corporate Sustainable Due Diligence Directive will lead to greater fragmentation of corporate accountability legislation, fail to protect lives and the environment, and make life harder for companies and investors
The delay in approving a new EU directive does a disservice to companies that need legal certainty, says chair of the UN working group on business and human rights Robert McCorquodale
Ahead of the European Union vote on whether to adopt the Corporate Sustainability and Due Diligence Directive (CSDDD), ICAR, joined by 69 other partner organizations around the world, sent the following letter urging European countries to vote in favor of a strong due diligence directive.
The Uganda Consortium on Corporate Accountability (UCCA) released a statement to express their disappointment over the Committee of the Permanent Representatives of the Governments of the Member States to the European Union (COREPER) failure to reach a final agreement on Corporate Sustainability Due Diligence Directive (CS3D).
Without prejudice to details regarding the scope of the directive, nor its loopholes and weaknesses, this briefing note sets to inform businesses, civil society, and Indigenous Peoples about relevant considerations for good practice in implementing the CSDDD in the context of Indigenous Peoples, in order to prevent human rights harms and in turn reduce legal, operational, reputational, and financial risks for businesses.
At the last minute, France made an impossible demand of the negotiators, calling into question the compromise agreement reached after several years of hard work by the Member States, the European Parliament, and the Commission, says ECCJ
The joint civil society statement highlights the vital nature of the EU sustainability legislation - necessary and overdue to trigger the change in business conduct - and the need to maintain collective pressure to avoid compromising key principles in subsequent decisions.
While an attempt was made to approve the directive in Council today, these efforts were reportedly derailed further by a last minute effort by France to significantly scale back the scope of the new rules to apply only to companies with more than 5,000 employees, instead of the proposed 500 employee threshold.
In a joint statement, 26 companies and networks urgently call on the German Chancellor to agree to the political agreement on the Corporate Sustainability Due Diligence Directive (CSDDD). ALDI SÜD, Bayer, Primark, FRoSTA, KiK, Mars, Tchibo, VAUDE, Ritter Sport and the Global Network Initiative are among those affirming business support for the text agreed in December 2023.
In a blog post, a group of BHR scholars and practitioners explain why the CSDDD is needed for businesses and human rights and address some of the most common misconceptions about the text.
The CSDDD is a world-leading initiative to put internationally agreed standards of corporate behaviour from the UN and OECD into law, write MEP Heidi Hautala and BHR experts Olena Uvarova and Ihor Konopka.
"It is precisely in times of political crisis and economic challenges that defending the universal rights and fundamental values that unite us can strengthen the foundation for a brighter future", the statement says.
The rapporteur wrote a letter to Italian Prime Minister Giorgia Meloni to express her serious concern at reports Italy may block the EU’s proposed new rules on human rights and environmental due diligence for companies. She called on the Italian Government to fully support the proposed Directive.
The adoption of the Directive would represent a significant advance in the global efforts to respect, protect, and fulfill children’s rights and human rights, support gender equality and address environmental challenges, as well as boost efforts to create a level playing field for businesses, the statement says.
Businesses (including Ferrero) as well as other stakeholders call on the Italian Government to support the Corporate Sustainability Due Diligence Directive.
WBCSD brings together over 225 of the world’s largest, most forward-thinking companies working together to accelerate the transition to a sustainable world.
UN High Commissioner for Human Rights Volker Türk on Tuesday urged EU leaders to approve a ground-breaking agreement on business and human rights, amid reports that support for the measure may now be in question in the European Council.
In the context of ongoing regulatory developments and the expected vote on the European Union Corporate Sustainability Due Diligence Directive, the UN Global Compact reiterates its support for mandatory human rights due diligence.
This week, the Council of the European Union can be a game changer, by adopting the compromise text resulting from political trialogue negotiations last December on the Corporate Sustainability Due Diligence Directive (CSDDD). CIDSE and COMECE urge the EU Member States to support the EU Corporate Sustainability Due Diligence Directive.
European Union countries on Friday postponed a decision on a proposed law which would require large companies to check if their supply chains use forced labour or cause environmental damage after Germany indicated it would abstain.
18 doctoral researchers from the International Doctorate Programme on Business and Human Rights at Friedrich-Alexander-Universität Erlangen-Nürnberg in Germany urge all EU member state governments to vote in favor of the Corporate Sustainability Due Diligence Directive (CSDDD).
The Corporate Sustainability Due Diligence Directive (CSDDD) has been taken off the agenda of Friday’s meeting of EU ambassadors, as it was not expected to reach a majority among EU countries.
70 companies and networks, including Nokia, Novo Nordisk, Ørsted, Vattenfall and Bestseller, call on their governments to vote in favour of the initiative at the upcoming Council meeting.
The Free Democratic Party is blocking a major EU business policy initiative at the last minute. Germany’s abstention reflects the earlier reluctance of its coalition partners to push back harder against efforts by the liberals to kill the law.
The crucial meeting on 9 February will determine whether the EU can secure a law that benefits companies, markets, affected communities, and the environment alike.
As the Corporate Sustainability Due Diligence Directive (CSDDD) nears a crucial juncture in its legislative and political journey, recent developments in Germany have intensified the debate surrounding this EU milestone in holding corporations accountable.
Gathered within the Business for a Better Tomorrow coalition, large, medium-sized, and small businesses, argue undermining the compromise would be a strategic mistake for the European economy and would create legal uncertainty.
Ahead of the EU Council’s vote on the European Corporate Sustainability Due Diligence Directive (CSDDD), over 300 business and human rights practitioners joined a call to support the CSDDD.
Ahead of a crucial vote on Friday on new landmark European Union business legislation that would help safeguard human rights, which the German government is now threatening to withdraw its earlier support for, Amnesty International calls for all member states to approve this legislation.
As the vote on the European Corporate Sustainability Due Diligence Directive (CSDDD) approaches this Friday, UNI Global Union is calling on governments to support this legislation, which is key to embedding human rights across companies’ operations and value chains as well as across economies.
AIM, which represents manufacturers of branded consumer goods in Europe, urges EU member states to support Corporate Sustainability Due Diligence Directive compromise agreement.
The German Institute for Human Rights urges the German Government and all other EU member states to vote in favour of the EU Corporate Sustainability Due Diligence Directive (CSDDD) in the final vote on 9 February.
On February 6, 2024, the Institutional Investors Group on Climate Change (IIGCC), the Principles for Responsible Investment (PRI), Eurosif - the European Sustainable Investment Forum, the Interfaith Center on Corporate Responsibility (ICCR), and the Investor Alliance for Human Rights (IAHR) released a statement reiterating their support for the agreement reached between the Council and European Parliament on the Corporate Sustainability Due Diligence Directive (CSDDD).
According to the trade unionists Nasir Mansoor and Zehra Khan, even if there are some areas that need to be improved, the German Supply Chain Act is already having a positive impact and is protecting human rights on the ground - as are those companies that are willing to address human rights in their supply chains.
Statement by legal professionals from France, Germany, Italy, Spain, Poland, the Netherlands and Portugal who work together to develop European Model Clauses (EMC) in the framework of the future European Corporate Sustainability Due Diligence Directive (CSDDD)
Chancellor Scholz needs to rule on the matter and decide that his government supports the law, despite resistance from the FDP, writes Juliane Kippenberg from Human Rights Watch.
Mary Robinson, Chair of The Elders, and Phil Bloomer, Executive Director, BHRRC, reflect on the massive leap forward made by the EU last week, with its ground-breaking political deal to better tackle human rights abuses and environmental harms caused by business. Globally, this is the first attempt to enshrine the international standards set by the UN and the OECD in laws across a major economic bloc, and with legal liability and administrative penalties for companies that do not comply.