1 Background

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This paper focuses on non-state-based operational-level grievance mechanisms. Such mechanisms are furnished by companies or by independent third parties. They act as a complement to other grievance mechanisms, such as official procedures (state non-judicial grievance mechanisms) and lawsuits, e.g. under civil law (state judicial mechanisms). In this way, non-state-based operational-level grievance mechanisms help to ensure that rights holders have access to a multi-layered system of remedy Operational-level grievance mechanisms can fulfil important functions in relation to risk identification and prevention, and help to build confidence between rights holders and companies. As rights holders can easily avail themselves of such mechanisms at an early stage, they can achieve a very strong impact with relatively little effort. However, this necessitates a well-designed grievance mechanism, as well as its rigorous and competent application.

As a supplement to corporate grievance mechanisms, collective grievance mechanisms – for example, within the scope of a multi-stakeholder initiative or industry association – can offer further benefits for companies and rights holders. [...]

Against this backdrop, this paper examines the role played by operational complaint mechanisms within the Corporate Sustainability Due Diligence Directive (CSDDD), which is currently being negotiated in a trilogue between the EU Commission, Parliament and Council. Based on this assessment, the paper provides recommendations on how to harness the current legislative momentum to create the necessary conditions for the establishment of effective operational-level and in particular collective grievance mechanisms across the EU. [...]

2 An evaluation of EU-level proposals

Summary

The EU Commission’s proposal does not yet adequately fulfil key functions foreseen by the UN Guiding Principles for operational-level grievance mechanisms. Specifically, the proposal evinces deficits with regard to the mechanism’s functions as (1) an early-warning indicator for identification and analysis of adverse impacts, and (2) a tool for remedy and redress. Moreover, there are excessive gaps in the proposal’s implementation of the UNGP effectiveness criteria. Both the EU Council and Parliament have affirmed that grievance mechanisms must be guided by the effectiveness criteria set forth under UNGP 31. This should be expressly stipulated in the legislative text, as recommended by the EU Parliament. Furthermore, the legislation should be formulated to ensure that grievance mechanisms can fulfil their key functions with a view to serving as an early-warning indicator and analytical tool, while also contributing to effective remedy and redress. Among the three proposals, the EU Parliament position comes closest to fulfilling these goals. Accordingly, the Parliament proposal should serve as the basis for the EU trilogue negotiations. However, the EU Parliament proposal needs to be improved in some respects. [...]

3 Recommendations for CSDDD design with a view to operational-level grievance mechanisms

Operational-level grievance mechanisms can play an important complementary role within a broader system of redress. Their particular value lies in their fulfilment of two key functions: (1) early identification and analysis of adverse impacts, which is crucial for prevention, and (2) remedy and redress. Operationallevel grievance mechanisms should be designed in line with the UNGP, which represents the international standard in this regard. This is crucial for the fulfilment of the aforementioned key functions. Adherence to UNGP recommendations is all the more important when it comes to independent collective grievance mechanisms. To ensure such mechanisms can realise their potential, the CSDDD should be specifically designed to strengthen their complementary function. [...]