The proposal for a Directive on corporate sustainability due diligence aims to promote sustainable and responsible corporate behaviour throughout global value chains. Since companies play an important role in building a sustainable economy and society, the proposal expects them to identify and, where necessary, prevent, end or mitigate adverse impacts of their activities on human rights, such as child labour and exploitation of workers, and on the environment, for example, pollution and biodiversity loss. By doing so, the businesses would enjoy a condition of legal certainty and a level playing field and workers and the environment at the production site of their goods would be better protected.

The proposal targets the companies’ own operations, their subsidiaries and their value chains. In order to comply with the corporate due diligence duty, companies would need to comply with different duties, relating to issues such measures for the prevention and mitigation of potential adverse impacts of their operations and the establishment and maintenance of complaints procedures.

Moreover, whereas the supervision and power of sanction of these new rules are accorded to national administrative authorities, also directors of companies would be required to become involved to ensure that due diligence becomes part of the overall, entire functioning of companies.

The aim of the proposal is to help ensure that the EU, in both the private and public sectors, acts on the international scene in full respect of its international commitments to protect human rights and foster sustainable development.

The accompanying and explanatory Communication on decent work worldwide, lays out the necessity to act on decent work worldwide, noting that an estimated 160 million children are in child labour while 25 million people are in a situation of forced labour. In the communication, the European Commission announces, among other initiatives, a new legislative instrument to effectively ban products made by forced labour from entering the EU market. This instrument would cover goods produced inside and outside the EU, combining a ban with a “robust enforcement framework”. It would build on international standards and complement existing horizontal and sectoral EU initiatives and, in particular, the due diligence and transparency obligations. Beyond this, the communication also sets out further upcoming and existing EU tools to advance the EU’s decent work agenda in the world, including through EU policies and initiatives with outreach beyond the EU, bilateral and regional relations, EU contributions in international and multilateral fora, and further engagement with stakeholders and in global partnerships.

CESI Secretary General Klaus Heeger said: “The promotion of decent work as well as a solid strategy to enhance the respect of the human rights and environment around the world is the key to realising sustainable economies and societies. If the EU wants to be a global frontrunner in climate and environmental protection and worker protection, it needs to be bold at home as well as lead by example in the world. The fact that the European Commission wants the EU to take action, also inspired by the guidelines provided by ILO, is an encouraging signal which we as CESI endorse.”