"EU model law on corporate accountability in global value chains: Model provisions on global corporate due diligence and liability for human rights abuses and environmental harm", January 2022

ECCJ has long been calling for EU legislation on mandatory human rights and environmental due diligence and corporate liability, requiring companies to identify, prevent, mitigate and account for human rights abuses and environmental damage in their global value chains.

EU-wide mandatory corporate due diligence and accountability legislation would:

• Enable the EU to fulfil its international duties under the UNGPs.
• Prevent human rights abuses in global business operations.
• Ensure a level playing field and a coherent legal framework for all EU companies.
• Promote responsible business conduct, including by foreign undertakings, which would be required to implement due diligence measures to operate in the single market.
• Ensure respect for core labour rights worldwide and reverse the current trend towards a race to the bottom in terms of social standards.
• Preserve the EU’s reputation as a global champion for human rights.
• Give consumers the confidence that the goods and services they buy are produced and provided responsibly.

ECCJ has now identified and detailed a set of minimum provisions that such legislation should include to ensure an effective and comprehensive EU regulatory framework for the above purposes...

Proposal for an EU law on corporate accountability in global value chains

Company scope

Undertakings, including financial institutions, regardless of size and sector, should be within the scope of this law if:

General obligation

Undertakings should:

These obligations should be applicable to business operations inside and outside of the EU.

Duty to identify, prevent and mitigate harm in global value chains

Duty of due diligence

Undertakings should take all necessary measures to respect and ensure respect for human rights and the environment throughout their entire value chain, including by adequately and effectively:

Undertakings should continuously evaluate and improve the effectiveness of their due diligence.

Given the lack of a comprehensive body of internationally recognised environmental standards, principles and normative standards of international environmental agreements should be complemented by a nonexhaustive catalogue of adverse environmental impacts...