ESG News

Corporate Sustainability Due Diligence Directive (CSDDD) backed by European Parliament

Jun. 1, 2023

The European Parliament has backed the Corporate Sustainability Due Diligence Directive (CSDDD) on June 1, 2023.

With 366 votes in favor and 225 against, the Parliament approved the draft CSDDD.

The CSDDD aims at integrating human rights and environmental concerns into supply chain management. With the new reporting obligations, firms will be required to address the negative effects of their actions, including those of their direct and indirect suppliers both inside and outside of Europe. This is intended to hold companies accountable for combating child labor, exploitation and environmental pollution along their global supply chains.The CSDDD is to apply to all EU-based companies with more than 250 employees and more than €40 million in annual sales worldwide.

The objectives of the CSDDD are similar to those of the German Supply Chain Due Diligence Act (LkSG) – but on a European level. However, in contrast to the LkSG, the CSDDD covers the entire value chain and affects a broader range of companies.

NEXT STEPS: This month, negotiations will begin with the EU states, which will have a say in the final agreement. The negotiations are expected to concentrate on disagreements over the scope of the new rules and when they will come into force.

Source: European Parliament

Corporate Sustainability Due Diligence Directive (CSDDD): What does it mean for your business?

Read more

EU Parliament once again in favor of tightening the CSDDD

Read more