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"EU lawmakers are playing favourites with financial institutions — but this could backfire"
MEPs are set to decide how to include the financial sector in the corporate due diligence directive on 1 June. Their decision could either strengthen or distort the European financial market and enable corporate abuses of people and the planet, Uku Lilleväli writes. [...]
The Corporate Sustainability Due Diligence Directive can provide the financial sector with a clear legal framework to address these issues and pave the way for a more robust and resilient economy. [...]
The European Commission and the European Council are proposing to exempt asset managers and investors and limit mandatory due diligence obligations to financial services only, giving a free pass to investments and financial products.
The European Parliament is edging closer to the final plenary vote that could change the course and ensure that investee companies and funds are not overlooked.
But for this, MEPs can’t deviate from the compromise deal that has been carefully crafted with wide support from all key EU groups, considering the thorough discussions in the parliamentary committees.
Exceptions for some make it unjust to others
Making an exception for investments and asset managers makes it unjust for other financial services and institutions.
What’s more, it also fails to incentivise them to identify and address sustainability risks.
Businesses in economies with underdeveloped capital markets that struggle to secure equity investments and rely on credit would be disproportionately more affected than their peers.
Although SMEs are exempt, businesses in economies with underdeveloped capital markets that struggle to secure equity investments and rely on credit would be disproportionately more affected than their peers.
To add more insult to injury, the European Commission and the European Council have also created blind spots for the financial sector as they have asked financial firms to conduct sustainability due diligence only once before the financing decision.
This allows them to overlook grave financial, physical and reputational risks that can arise throughout the financing cycle.
Similarly to how banks need to know of any substantial changes in the credit profile of the mortgage holder or credited company, effective risk management requires an understanding of the relevant sustainability risks and harms that occur in the portfolios.
Full financial sector inclusion is proportionate, workable and necessary
Many investor groups like Eurosif, Principles for Responsible Investment and Institutional Investors Group on Climate Change have emphasised that requiring the entire financial sector, including asset managers and institutional investors, to conduct sustainability due diligence is proportionate, workable and necessary to manage sustainability risks, impacts and opportunities.
Following a risk-based approach, all financial institutions would have to prioritise risks and impacts most relevant to their business model, mandate and portfolios, thus not putting a disproportionate burden on financial firms or omitting others.
It is crucial that MEPs support the entire compromise deal, which includes due diligence obligations for the entire financial sector.
Mandatory sustainability due diligence for all financial institutions, services and instruments would not only signal the need to address sustainability issues in the wider economy but also allow financial institutions to be more resilient and safeguard their long-term financial stability.
Ahead of the last political trilogue on the Corporate Sustainability Due Diligence Directive on Wednesday 13 December, a group of businesses including IKEA, ALDI SÜD, Novo Nordisk, Tchibo, L'Oreal and ABN AMRO, trade unions and civil society organisations, jointly urged EU co-legislators to reach a political agreement in view of adopting an effective final law.
As trilogue negotiations reach concluding stages, the Business & Human Rights Resource Centre repeats its call for the CSDDD to cover the full value chain, including downstream, so technology companies can be effectively held accountable for human rights and environmental abuses.
Three benchmarks of financial institutions on human rights underline the need for inclusion of financial institutions in the currently negotiated EU Corporate Sustainability Due Diligence Directive.
Companies can impact the full spectrum of human rights and for that reason, they should identify adverse impacts against all internationally recognised human rights instruments in line with the approach of the UNGPs, the statement by National Human Rights Institutions that form part of the GANHRI Working Group on Business and Human Rights reads.
Ahead of what may be the final political trilogue negotiations on the EU Corporate sustainability due diligence (CSDDD), 93 Human Rights and environmental defenders and CSO from the Global South send a letter to the Spanish Presidency of the Council of the European Union, as well as the rapporteur Lara Wolters and the Commissioner for Justice, Mr Didier Reynders, calling for a directive that protects human rights and our planet first beyond “business as usual”.
BHRRC invited BNP Paribas to comment on two articles on the inclusion of financial activities in the EU CSDDD. BNP Paribas said, that like all large French companies it is subject to the French duty of Vigilance law and has welcomed the European Union’s plan to legislate as an essential step in establishing a level-playing field at regional level.
Many businesses have spoken out in support of including indigenous peoples' rights, including FPIC, Human Rights Defenders and meaningful stakeholder engagement in the EU due diligence law.
Negotiations on the EU Corporate Sustainability Due Diligence Directive have resumed, but they face up an uphill struggle in the face of pushback from some financial institutions.
They call for the law to apply to the entire global value chain, within and beyond the EU's borders, include the financial sector, establish, on a mandatory basis, consultations and participation of rights holders and stakeholders, and ensure access to justice for victims, among others
To be fully effective, the provision on disengagement must tackle both the risk of companies disengaging too hastily or irresponsibly (the “cut and run” approach), as well as the risk of companies not disengaging where necessary. In the former case, companies risk severely harming relevant stakeholders. In the latter, they risk fostering human and/or environmental human rights violations. The recommendations by CSOs aim to ensure that Articles 7(5) and 8(8) address and prevent the aforementioned scenarios.
According to the NGOs, external pressure from investors, banks, policymakers and regulators is key to forcing Glencore to change. The EU should properly integrate the human rights responsibilities of the financial sector into its Corporate Sustainability Due Diligence Directive (CSDDD).
As negotiations of a final text of the European Union (UE) Corporate Sustainability Due Diligence Directive are progressing, the International Federation for Human Rights (FIDH) publishes four new briefs with recommendations for EU institutions to ensure that the legislation better protects human rights and the environment from corporate harms.
The impending Corporate Sustainability Due Diligence Directive offers a unique opportunity to compel larger companies across sectors to transition their business model, take concrete steps to reduce emissions and adapt to growing climate-related risks.
Against the background of potential implications under German law, the German Institute for Human Rights summarizes key access to justice elements for both the design and transposition of the CSDD Directive.
Ahead of a COREPER meeting to update the EU Council’s negotiation mandate for the CSDDD trilogue, over 60 NGOs are drawing policymakers’ attention to five issues that are key to aligning the legislation with international standards and ensuring real-world improvements for people and the planet: climate transition plans; civil liability and access to justice; inclusion of the financial sector; value chain; normative scope
GNI calls on EU Member States and the European Parliament, with the support of the Commission, to adopt a robust Corporate Sustainability Due Diligence Directive that is aligned with the established international frameworks.
The Spanish Presidency of the EU Council is leaning towards the exclusion of the financial sector from the EU corporate accountability rules, which are currently under inter-institutional negotiations, according to an internal document.
As representatives of the European Parliament and EU countries negotiate the details of the Corporate Sustainability Due Diligence Directive (CSDDD) in Brussels, visiting Guatemalan human rights activist Bernardo Caal Xol has urged them to implement the directive, which would force European companies to behave more responsibly.
This issue sheet by ECCHR focuses on the applicability of, and implications for, the CSDDD to the arms industry and in relation to conflict-affected areas.
Open letter from Nordic investors to the Danish and Swedish Governments in the context of trilogue negotiations on the EU Corporate Sustainability Due Diligence Directive
Financial institutions in the EU have been involved in driving environmental and human rights-related harm, but the upcoming Corporate Sustainability Due Diligence Directive could minimise such impacts, highlights a new WWF report.
While the EU has so far failed to take appropriate action against the most invasive forms of spyware, the Corporate Sustainability Due Diligence Directive (CSDDD) could offer a crucial opportunity for the EU to rein in the rampant human rights abuses of the surveillance technology sector, argues Hannah Storey of Amnesty International.
The representative associations of the Dutch insurance, pensions and banking sector have reached out to EU policymakers to call on them to include financial institutions in the scope of the Corporate Sustainability Due Diligence Directive (CS3D).
UN High Commissioner for Human Rights Volker Türk, referring to a new OHCHR position paper, urges EU institutions to ensure the forthcoming CSDDD is fully aligned with the UNGPs. The Directive should adopt a true risk-based approach, without legal loopholes that would allow companies to ignore their most severe adverse impacts, e.g. because they occur downstream. It should clearly differentiate what is expected from companies when they cause or contribute to an adverse impact or when they are linked to it, which includes recognizing the limits of over-reliance on contracts and audits. The position paper also reiterates the importance of meaningful engagement with affected stakeholders, as well as of meaningful accountability measures.
UN PRI sent a letter to representatives of the Governments of France, Germany, Luxembourg and Italy as well as DG JUST and DG FISMA in the European Commission, calling for policymakers to support a risk-based approach, aligned with international standards and grounded in the concepts of severity and leverage to ensure clear, achievable and proportionate due diligence obligations for the financial sector.
EU countries are set to start discussions on the inclusion of the financial sector under the scope of the proposed EU corporate accountability directive, in an effort to find a negotiating mandate and strike a deal with the European Parliament.
This open letter calls on the European Union (EU) to include rights to self-determination, to lands, territories and resource, and to free, prior and informed consent (FPIC) in the upcoming Directive on Corporate Sustainability Due Diligence.
Six civil society groups working on sustainable finance called on EU Member States to back human rights and environmental rules for the financial sector, as part of negotiations on the Corporate Sustainability Due Diligence Directive.
The costs of reacting to extreme weather events will be even higher if EU Member States do not hold the private sector accountable for its climate impacts, write Paul de Clerck and Cass Hebron (FOEE), Julia Otten and Daniel Torán (Frank Bold) and ECCJ for the Justice is Everybody’s Business campaign.
The EU should include financial markets in the scope of its Corporate Sustainability Due Diligence Directive (CSDDD) to help reorientate capital markets towards more sustainable investments while making European financial markets more consistent and reliable, argues Richard Gardiner.
In this report, Shift takes stock of where progress has been made – and where work still remains – to ensure greater alignment between the positions of the three EU political institutions – the Commission, Council and Parliament – and the international due diligence standards.
The Dutch National Contact Point identified notable points of divergence between the CSDDD regulatory framework and the OECD framework in 14 key areas. It notes that there is a concern limitations in the CSDDD regulatory framework in comparison with the OECD framework will result in a dilution of RBC principles and standards of conduct from the OECD Guidelines and/or in a lack of clarity about what is expected from companies in terms of RBC and due diligence.
According to the study financed by Arbeiterkammer Wien, the stricter the regulations and the fewer the loopholes that are left open, the more effective the EU CSDDD will be, not just in terms of protecting human rights, but also in economic terms.
The organisations welcome the CSDDD and its goal to address the human rights and environmental impacts of companies' global value chains. However, in order for it to lead to positive change, it must take into account the interests and needs of rightsholders, especially those in the most vulnerable position in global value chains.
Earthsight reveals that a year after the original investigation trade links between companies involved in indigenous rights violations in Brazil and European companies remain, highlighting the need for strong indigenous rights protections in the CSDDD.
Several EU member states have yet to decide on their position on some key aspects of the EU’s draft law to hold companies accountable for human rights and environmental violations throughout their value chain, slowing down the ongoing negotiations on the file.
The trilogue negotiations on the CSDDD are an opportunity to establish due diligence obligations for financial and non-financial companies across the EU market.
As the first part of a briefing series by four NGOs, this policy brief examines the role of operational grievance mechanisms in the ongoing negotiations of the Corporate Sustainability Due Diligence Directive between the EU Commission, the EU Parliament and the EU Council. These mechanisms can play an important complementary role within a comprehensive remedy framework. An analysis of the three proposals shows that the position of the EU Parliament is most in line with these objectives. Therefore, this perspective should prevail in the EU trilogue negotiations. However, there is still scope for improving certain aspects of the EU Parliament's position.
The draft EU directive raises cautious optimism among civil society organisations working for the rights of people affected by corporate behaviours in third countries, however concerns remain that it could be diluted into a box-ticking exercise and limit access to justice for victims of corporate abuses.
This publication analyses the different legislative proposals for an EU Corporate Sustainability Due Diligence Directive, highlighting five key issues and making recommendations for the ongoing trilogue negotiations.
The negotiators agreed on some points this week, and the Spanish EU Council Presidency is expected to push on the talks starting in September in order to strike a deal before the end of the current term.
This piece seeks to inform the current debate by broadening the examples of sectors, products and services and current business practice which demonstrate the critical need for, and ability of, companies to consider human rights risks downstream.
More than 160 faith leaders worldwide, men and women from various faiths, have signed the statement urging European Union lawmakers to adopt a robust legal framework to hold companies accountable for environmental damage and human rights abuses.
This briefing addresses two main challenges for the Trilogues negotiations in order to allow for effective environmental and climate protection in the Corporate Sustainability Due Diligence Directive (CSDDD): 1. Listing environmental conventions does not provide adequate protection, and 2. tackling climate change is a critical part of environmental due diligence.
June 2023 marked the World Day Against Child Labour and the beginning of the final negotiation phase of the EU Corporate Sustainability Due Diligence Directive
The position of the European Parliament supports the full respect for the United Nations Declaration on the Rights of Indigenous Peoples in the new CSDDD, says the Securing Indigenous Peoples’ Rights in the Green Economy (SIRGE) Coalition
EU governments should heed the call of businesses, civil society, and the multilateral institutions that built the due diligence normative framework to align their domestic law with the OECD Guidelines, including its latest updated text.
This policy briefing paper discusses the rationales for including more substantive provisions on engagement with stakeholders in general and with rights-holders in particular. It also pinpoints areas for improvement in the current draft and makes recommendations for strengthening the provisions on stakeholder engagement, proposing specific language for amendments in the final text of the directive.
NGOs including the European Coalition for Corporate Justice welcomed the vote as the position includes important improvements compared to previous drafts. Remaining weaknesses must be addressed in trilogue negotiations between Parliament, Council and Commission over the coming months.
GNI supports "key improvements" proposed by the JURI Committee. The multistakeholder initiative recommends that the Directive: (i) take a comprehensive approach to the scope of due diligence; (ii) adopt a risk-based approach across the full value chain, (iii) clarify key concepts such as meaningful stakeholder engagement, (iv) take a consistent and holistic approach to the scope of rights and sectors covered in line with international frameworks and existing expectations; and (v) help identify and incentivize participation in meaningful, credible multistakeholder initiatives.
The report has two key aims. The first is to express concern over the current trajectory
of HRDD legislation and its capacity to effect meaningful change for workers and trade unions. The second key aim of the report is to offer guidance on how HRDD could be legislated in such a way as to drive meaningful change for workers in transnational supply chains.
Briefing from Shift offering recommendations for the EU's Corporate Sustainability Due Diligence Directive based upon interviews with businesses and other stakeholders in Bangladesh, Kenya, Tanzania and Thailand.
As the Parliament goes on to finalise its position and the trilogue process begins, the institutions must improve the text, ensuring that the role of human rights defenders and the risks they face are fully taken into account, says UN Special Rapporteur Mary Lawlor
This briefing outlines Amnesty International’s key concerns for the CSDDD, detailing where the proposals from the European Commission and the Council fail to live up to international human rights standards and what these gaps could mean for the victims of corporate harm. It also presents Amnesty’s key recommendations to address those gaps.
MEPs are set to decide how to include the financial sector in the corporate due diligence directive on 1 June. Their decision could either strengthen or distort the European financial market and enable corporate abuses of people and the planet, Uku Lilleväli writes.
JURI position does not deliver the necessary access to justice for victims of corporate abuse or provided adequate measures to prevent climate destruction, says Friends of the Earth Europe
In this policy paper, FIAN outlines through examples in Guinea, Brazil and Cambodia why the CSDDD should apply to the financial sector, and the specific requirements that must be guaranteed to ensure its effective application.
MEPs agreed on the rules to be applied from the production to the sale, distribution and waste management of products or services provided by a company, leaving out due diligence and liability provisions regarding the use of products or services.
Polling reveals majority of Europeans across Austria, Belgium, Finland, France, Germany, Ireland, Netherlands, Poland, Slovenia and Spain want companies operating in the EU to be compelled to reduce emissions
EU lawmakers in the leading legal affairs committee of the European Parliament are expected to vote on their position on the proposed corporate accountability rules towards the end of April, although some key points remain open.
Publication by the Danish Institute for Human Rights: "How do the pieces fit in the puzzle? Making sense of EU regulatory initiatives related to business and human rights"
Reacting to reports that proposed EU business legislation will exempt companies from addressing the human rights risks linked to how their products are used, including arms, tools of torture or surveillance equipment, Amnesty International calls for the exemption on use to be reversed.
"A proposed EU law to prevent environmental and human rights abuses by multinationals has been cautiously welcomed by global Indigenous leaders seeking to highlight the damage done by extractive industries. However they say the text needs to go further if it is to protect Indigenous populations from mining companies."
The EU corporate sustainability due diligence directive represents a key opportunity to advance women’s rights and gender equality in companies’ international value chains. However, the draft text fails to integrate a gender lens and risks leaving women behind.
Even though the Chilean Andina mine is exacerbating the water shortage in the region, numerous European manufacturers of mining machines and mining equipment had business relationships with the mine. The case study shows why the legal regulation of due diligence obligations in downstream value chains is necessary within the framework of the currently discussed Corporate Sustainability Due Diligence Directive.
This report by the Global Business Initiative on Human Rights (GBI) provides key questions for companies to ask when establishing downstream human rights due diligence, and offers an overview of the expectations contained in international standards. Companies are already conducting due diligence in downstream contexts. Yet, in current policy debates at the EU and OECD, the scope of human rights due diligence is being contested
The European Parliament’s environment committee has voted to include an obligation for large companies and SMEs in certain risky sectors to risk-assess their global value chains for abuses like oil spills and pollution, but the improvements are not yet sufficient to prevent and end the vast impacts of companies on climate change, said the European Coalition for Corporate Justice.
Members of the European Parliament’s environment committee voted on Thursday (9 February) to strengthen requirements on climate protection in the proposed EU rules on corporate accountability.
A key vote is taking place in the European Parliament's Environment Committee this Thursday, when MEPs will decide whether or not to include climate in their corporate due diligence directive.
As the world faces a growing array of environmental and social challenges, it is more important than ever for businesses to take a proactive and responsible approach to sustainability, writes WWF.
European technology companies and investors that fail to do risk-based downstream due diligence risk contributing to severe human rights violations committed by repressive regimes, such as in Iran
In 2016, the Honduran environmental activist Berta Cáceres was killed trying to protect her ancestral lands against the Agua Zarca hydroelectric project, bankrolled by European financial institutions. The CSDDD could stop companies profiting from projects linked to the repression and murder of environmental defenders - but not if it lets investors off the hook, says Global Witness
The study commissioned by The Left in the European Parliament sets out the various ways that subcontracting undermines labour laws in the EU and enables exploitation of workers. It among other things calls for a new European Regulation on decent work in the subcontracting chain and amending the Corporate Sustainability Due Diligence Directive.
In an interview with EURACTIV Lara Wolters highlighted that due diligence is also about downstream activities. According to her, this aspect has become even more relevant after the recent accusations that allege Qatar bribed European lawmakers. The rapporteur asserts that good governance, bribery and corruption should be part of due diligence discussions.
ShareAction, Accountancy Europe, Eurosif, Frank Bold, Finance Watch and WWF, as members of the Informal Group on Sustainable Finance, have released a joint statement on the EU’s Corporate Sustainability Due Diligence Directive (CSDDD).
After the adoption of a position by the Council, Amnesty International criticises that the exclusion of banks and financial institutions and waivers for companies that sell high-risk security equipment and surveillance technologies undermine the directive.
The general approach reached today completes the negotiating position agreed by the Council and provides the Council presidency with a mandate to start negotiations with the European Parliament.
Ahead of Thursday’s (1 December) meeting of EU industry ministers, the fight over whether to include the financial sector in the scope of the Corporate Sustainability Due Diligence Directive (CSDDD) is still ongoing with France, Italy, and Spain threatening to block a common member state position.
The letter calls for a General Approach that covers the full value chain including downstream impacts and the full coverage of the financial sector; expands the scope of rights and impacts covered; and strengthens access to justice provisions and addresses barriers to justice often faced by claimants in business-related human rights and environmental cases.
If the proposals were adopted, they would severely limit access to justice for victims of corporate abuses, seriously undermining the effectiveness of the directive, the letter says.
The statement outlines four key areas which need particular attention if the Directive is to effectively aid in transforming the tech sector: scope of companies subject to the law; scope of rights; value chains and business relationships; and stakeholder engagement & access to justice and remedy
The European Commission’s proposal for a directive on corporate sustainability due diligence includes a dangerous overreliance on industry schemes, multi-stakeholder initiatives, and third-party auditing, a briefing paper by SOMO concludes.
On 24 November, Eurosif, the Investor Alliance for Human Rights and the PRI, supported by 142 signatories, released a statement of support for an ambitious and effective EU directive on corporate sustainability due diligence (CSDDD)
As EU member states close in on a common negotiating position on the Corporate Sustainability Due Diligence Directive (CSDDD), they are fighting over whether companies should do due diligence for their entire value chain or just the supply chain.
Luxembourg, Ireland and Germany have indicated they want to exclude asset managers and institutional investors from scope, with France and Italy going further and calling for the entire financial sector to be left out, an EU diplomat familiar with the negotiations said.
The EU’s long anticipated Directive on Corporate Sustainability Due Diligence is set to fail to hold ICT companies to account for human rights abuses and environmental damage if key shortcomings including on scope and stakeholder consultation are not addressed.
EU-based financiers and their subsidiaries have played central roles in financing projects that have caused human rights violations and environmental damage, and have been linked to land grabbing, deforestation, and violence against communities and land and environmental defenders.
On 26 September, the German Federal Ministry for Economic Cooperation and Development held a virtual conference to discuss how the Directive can have a positive impact on developing countries.
Host Richard Howitt speaks frankly and personally about what moves policy makers, businesses, and activists to make responsible business the norm and redefine business.
A coalition of cocoa and chocolate manufactures and other organisations welcomes the EU Directive on Corporate Sustainability Due Diligence and calls for improvements in new position paper.
UN Human Rights is concerned about the proposition being advanced by some stakeholders that the requirements of CS3D should not apply to downstream impacts on human rights that a company may be involved in. Such an exclusion would not align with the UNGPs and could undermine the international consensus about the scope of the Corporate Responsibility to Respect Human Rights.
The campaign, launched on 6 September in Brussels, calls for "no more exploitation, no more environmental destruction, no more unjust business practices by European companies".
On this page, you will find selected responses in support of effective legislation aligned with international standards from companies and business associations/initiatives who submitted feedback along with other respondents.
This piece argues that for legislation to succeed in advancing the rights of the most affected and to lead to better human rights outcomes for rights-holders, it is crucial to anchor such laws and regulations with not only the perspective of rights-holders but their ongoing involvement.
The in-depth analysis requested by the European Parliament's Subcommittee on Human Rights compares the Draft Directive proposed by the European Commission with the positions adopted by the European Parliament and by the Foreign Affairs Committee. It recommends various changes to the Draft Directive, for example in regards to the scope of human rights and environmental standards and the corporate due diligence duty and process.
The CSDD Directive must transform the situation on the ground for the impacted communities and human rights defenders, particularly women and indigenous peoples, says the ICBHR.
An alliance of over 60 companies and initiatives are calling on the European Parliament, Commission and EU member states to ensure that living wages and incomes are included in the final corporate sustainability due diligence directive (EU CSDDD) and that their definitions should not be compromised.
OHCHR highlights five areas where they believe further attention and discussion are needed in
order to improve alignment with the UNGPs, and to create an EU regulatory framework that is capable of meeting the EU’s stated goals, including: company scope; subject-matter scope; taking action; compliance, enforcement and remedy; and stakeholder engagement.
The GIHR provided comments with regards to: scope of value chain, due diligence in "established business relationships", scope of companies covered, civil liability & administrative enforcement
While the draft directive has promising elements, we highlight considerable gaps that must be closed to ensure the law can fulfil its historic potential and bring tangible benefits for workers and communities along global value chains (also includes an overview of relevant resources).
The EU's directive on Corporate Sustainability Due Diligence could represent a landmark step forward, but the proposal contains significant flaws which risk preventing its urgently-needed positive impact for people, planet and climate. We join 220+ organisations calling for an effective law.
After a thorough internal analysis of the Directive’s content, as well as external consultations, ASI is now releasing a comprehensive analysis of the proposal for a directive on due diligence, with specific recommendations for the European Parliament and the European Council to strengthen it.
The document seeks to guide the formulation of effective accompanying support to the implementation of the legislation that maximizes the opportunities of mandatory due diligence.
The briefing addresses shortcomings in the parts of the proposal that relate to corporate governance, directors’ obligations and the responsibilities of the financial sector and makes recommendations for appropriate changes.
The coalition successfully campaigned for a supply chain law in Germany. However, due to resistance from the business lobby, this law still has gaps and weaknesses, which is why an even stronger EU supply chain law is needed.
To close women’s month, 82 civil society organizations from across Europe sent an open letter to European Commissioners, Members of Parliament and Permanent Representations involved in the co-legislation of human rights and environmental due diligence legislation, urging them to make sure the gender-responsiveness gap is addressed.
All feedback received will be summarised by the European Commission and presented to the European Parliament and Council with the aim of feeding into the legislative debate.
DIHR examines foundational aspects such as personal and material scope, business relationships and the scope of due diligence across the value chain, use of contractual assurances as well as enforcement and liability. It then goes on to consider each element of the due diligence obligation.
The authors analyse some of the weaknesses of the EU due diligence proposal by highlighting where the draft law falls short in providing better outcomes for people and planet
This two-part blog explores in detail the EU's draft Directive on Corporate Sustainability Due Diligence, arguing it provides a strong legal basis to enhance corporate accountability and to create a standard for responsible and sustainable business conduct.
Robert McCorquodale and Stuart Neely consider how the existing duties of directors might be affected if human rights due diligence becomes a mandatory obligation for companies.
Letter sent to President von der Leyen and Commissioners Breton and Reynders by the International Labour Organization, the Organisation for Economic Co-operation and Development (OECD), and the Office of the UN High Commissioner for Human Rights (OHCHR).
Anti-Slavery International raises concerns around loopholes in accountability for long supply chains, coverage, and meaningful stakeholder engagement and inclusion of civil society and trade unions.
With the right framing, a Directive could advance better outcomes for people and planet. However, for these significant opportunities to be realized, and for the Directive to meet its stated ambition, it is critical that the Directive is firmly grounded in the key international standards on sustainability due diligence adopted by the UN and the OECD.
The European Commission’s new corporate due diligence proposal needs significant improvements to prevent and address human rights abuses and environmental harm
ActionAid International raises concerns about the European Commission's proposal for a Sustainable Corporate Due Diligence Directive, specifically on the lack of inclusion of any reference to women and other marginalised groups
The newly published Corporate Sustainability Due Diligence Directive falls short on involving workers and trade unions in shaping and monitoring sustainable business due diligence strategies, says the European Trade Union Confederation
The European Coalition for Corporate Justice identifies areas for improvement in the EU Commission's newly released proposal for a Directive on corporate sustainability due diligence
Frank Bold argues that the EU's legislative proposal on corporate accountability presents just some elements that foster integration of sustainability and long-term thinking in corporate governance rules, creating the risk of a tick-the-box exercise
On 23 February 2022 the European Commission published a long awaited legislative proposal laying down rules for companies to respect human rights and environment in global value chains
The proposed EU law to stop corporate abuse fails to guarantee justice or make companies liable for their climate impacts, says Friends of the Earth Europe
The EU's proposal falls short on a number of fronts in its promise to promote sustainable business and investor practices and ensure accountability for harms, says the Investor Alliance for Human Rights
A leaked copy of the soon to be proposed EU Directive on Corporate Sustainability Due Diligence includes a reduced scope of the law to cover only big business, and a civil liability regime
Business has a duty to respect human rights, even when and where states waver in their responsibilities to safeguard workers, communities and our natural environment, writes Andre Hoffmann from Roche.
The Escazú Agreement and its principles must be integrated into the list of relevant international conventions that companies must comply with as part of the due diligence measures prescribed in the regulation, the organisations write.
Europe needs a Copernican Revolution in corporate behaviour to tackle the climate crisis and social disparities. To do that, the EU should start with clarifying the fundamentals of corporate law, the authors argue.
Not enough companies are acting to introduce effective human-rights due diligence. The EU must seize the opportunity to swiftly introduce regulations that drive better outcomes for people and planet
Open Letter by WWF European Policy Office, Finance Watch, ShareAction, Frank Bold, Economy for the Common Good & Oxfam: An encompassing approach to effective Sustainable Corporate Governance
This compendium contains the contributions of experts that participated in a series of webinars exploring the topic of due diligence and its connections to civil liability, private international law, and sustainable finance, among other topics
It's high time for the European Commission to finally make good on its promise and publish the long-awaited legislative proposal regulating companies and their supply chains
The request, made on the 15th December 2021, asked for all correspondence and (e)meetings with stakeholders and members of the RSB, related to the proposal, as well as the RSB opinion and the Commission Impact Assessment.
The European Coalition for Corporate Justice has identified a set of provisions that would make an EU mandatory human rights due diligence law effective and comprehensive
A network of NGOs from the DRC calls on EU Commissioners to consider risks to human rights defenders and how to address them in the upcoming EU Sustainable Corporate Governance initiative
NGOs raise concerns that the delay may be symptomatic of a risk that the Commission is parting from its initial ambition to tackle sustainability gaps in corporate governance.
14 industry associations and responsible business initiatives express their support for the EU’s objective to ensure respect for human rights and the environment through an EU-harmonised regulatory approach to due diligence.
MEPs Lara Wolters, Heidi Hautala, Manon Aubry and Pascal Durand have sent an access to document request to the Commission, requesting access to the 2 opinions of the Commission’s internal quality control body, the Regulatory Scrutiny Board and communication between interest groups and the RSB on the Commission’s Sustainable Corporate Governance initiative.
Signatories express their concerns about the delay and urge President von der Leyen and the Commission to ensure it is used for positive impact and action on the proposal is expedited.
The European Commission should keep its promises and uphold corporate human rights obligations according to an open letter sent to President Ursula von der Leyen on 8 December signed by 47 civil society and trade union organisations.
Socialist and Democrat Members of the European Parliament call on the European Commission to come forward with draft legislation without further delay.
In a debate in Parliament Dutch Minister for Foreign Trade and Development Cooperation announced that due to the "very disappointing" and "indefinite" delays at the European Commission, the Dutch government will immediately start work on ambitious national binding due diligence legislation.
The press kit outlines the main key points that should be included in the upcoming EU law, as well as a thorough analysis of its significance through case studies and testimonies.
On International Women Human Rights Defenders Day, over 60 civil society organisations sent an open letter to European Commissioners, Members of Parliament, and Council of the European Union Representatives, urging them to make the forthcoming corporate human rights and environmental due diligence law gender-responsive.
While the discussions on sustainable corporate governance and supply chain due diligence continue at EU level and a proposal for a directive has been postponed several times, Germany is sending a strong signal.
The struggle of the Lenca people, of Bertha and her daughter, is only one example of the daily struggle of indigenous and peasant communities to protect land, water sources, forests and our human family from the negative impacts of corporate activities. The upcoming Sustainable Corporate Governance proposal could be a game-changer for communities faced with corporate abuse worldwide.
Campaign calls on Commission Vice-President Věra Jourová, Commissioner for Justice Didier Reynders and Commissioner for the Internal Market Thierry Breton to introduce an ambitious legislative proposal on mandatory human rights and environmental due diligence.
In a letter to President von der Leyen, and Commissioners Reynders and Breton, MEPs stressed the importance of addressing barriers to justice for victims of corporate abuse in the upcoming due diligence law proposal
To effectively stop human rights violations and negative environmental impacts in global supply chains, EU policymakers should ensure the upcoming legislation leads to positive impacts for rightsholders and improves the situation and the livelihoods of smallholders.
In her letter to the presidents of EPP, S&D, Renew, GreensEFA and the Left political groups, President Von der Leyen stresses the importance of ensuring consistency in developing a sustainable framework for economic operators, and that the initiative will be adopted in 2021
"By passing world-leading legislation now to ensure transparency, liability for environmental and human rights abuses and remedy for the individuals affected, the EU can point the way to a safer, more sustainable planet, and establish frontrunner status in sustainability and justice" - MEP Toine Manders, European People's Party, and Steve Trent, Environmental Justice Foundation
Saeeda Khatoon has been fighting for a long time to hold those who are responsible for a fatal fire at the Ali Enterprise garment factory in Karachi, Pakistan to account.
The note provides recommendations in light of the European Parliament's resolution of 10 March 2021 on corporate due diligence and corporate accountability, focusing in particular on issues connected with the translation of human rights due diligence into a binding legal standard, and on corporate accountability and remedy.
This report explores how the proposed EU mandatory due diligence law could affect the human rights of workers in global supply chains, with a focus on forced labour and exploitation
The undersigned Members of the European Parliament sent a letter to President von der Leyen and 13 commissioners reiterating some of the key demands of the European Parliament’s legislative own-initiative resolution regarding the upcoming proposal on Sustainable Corporate Governance.
The briefing follows a public letter sent by NGOs to DG Justice Commissioner Didier Reynders and Executive Vice-President Frans Timmermans in support of the EU Commission plans on Sustainable Corporate Governance.
The fate of the proposals on (i) minimising the risk of deforestation and forest degradation associated with products placed on the EU market and (ii) sustainable corporate governance is now unclear, raising concerns among civil society.
This paper takes into consideration the EU draft Directive on Corporate Due Diligence
and Corporate Accountability and examines ways to better design and integrate environmental due diligence
Ferrero, Mars Wrigley, Mondelez International, Nestlé, Tony’s Chocolonely & Unilever shared a joint letter to Commissioners Reynders, Breton and Sinkevičius, calling for the adoption of a legislative proposal without further delay.
Letter to Executive Vice President for the European Green Deal & EU Commissioner for Justice: NGO support for the EU Commission plans on Sustainable Corporate Governance and response to criticism
Eight years on from the Rana Plaza building collapse, many European fashion companies are still linked to human rights abuses on a daily basis. For an EU due diligence law to make a difference, it can’t just be a list of boxes companies must tick.
The organisations call on the EU to ensure that its upcoming legislative measures are effective and fully uphold their rights as set out in international law, and in line with the EU’s own commitments.
This brief prepared by the NOVA Centre for Business, Human Rights and the Environment outlines current national and European legislative developments regarding HREDD
EU Financial Stability Commissioner Mairead McGuiness and Justice Commissioner Didier Reynders explain the importance of aligning the due diligence law proposal with reforms to the non-financial reporting directive (NRFD) if companies are to effectively be held to account
Over half a million people around the globe have demanded a strong EU law to hold corporations accountable for their impact on human rights, including trade union and workers’ rights, and the environment. These demands were made as part of the public consultation launched by the EU Commission.
John Ruggie voices three reservations: (1) directors are not the main driver of short-termism; (2) opposition to addressing directors’ duties may jeopardize the initiative; and (3) doing so may be largely unnecessary, as properly designed mandatory due diligence will itself change directors’ duties, he writes.
Richard Gardiner from Global Witness explains how a due diligence law would present a chance for the EU to reshape the often problematic relationship between corporations, people and the planet.
The European Commission hold a virtual exchange with three business & human rights advocates from the Global South as part of a public consultation for the proposed corporate human rights and environmental due diligence law
The European Commission is considering a new law to hold businesses accountable for their impact on people and the planet. To support people in participating in the EU's consultation on mandatory due diligence, Friends of the Earth, the European Trade Union Confederation, Arbeiterkammer Europa (AK Europa), Österreichischer Gewerkschaftsbund (OGB) and the European Coalition for Corporate Justice (ECCJ) have launched a new website.
There is growing pressure for corporations to do the right thing, but are EU lawmakers willing to act, asks ECCJ's Claudia Saller in this opinion piece for EU observer.
The initiative aims to improve the EU regulatory framework on company law and corporate governance. To this end, the Commission is seeking the views of a broad range of stakeholders.
As the European Parliament begins developing proposals for a new – and momentous – law to hold business to account for its impact on people and planet, Richard Gardiner from Global Witness sets out how this process came about and what needs to happen now to ensure this really delivers results.