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Today marks a pivotal moment in the European Union's commitment to sustainability and corporate responsibility. The member states of the EU have reached a consensus on the Corporate Sustainability Due Diligence Directive (CSDDD), establishing a new benchmark for corporate conduct across the Union. This agreement crafts a framework mandating companies to integrate sustainable practices and due diligence into their operations.
Heidi Hautala, Vice President of the European Parliament and Chair of the EP Working Group on Responsible Business Conduct (RBC wg), shares,
"The beneficiaries of the CSDDD will be the millions affected by modern slavery, alongside other victims of corporate negligence and abuse. Responsible companies will also gain from equal playing fields, and there will be a more robust engagement from businesses in the fight against climate change."
After extensive negotiations and compromises, the EU member states finalized the text of the CSDDD. This accord represents a crucial step towards its formal adoption and implementation.
This directive will now impact around 5,400 European companies, significantly narrowing the original scope by almost 70% to just about 0.05% of all businesses. Despite this considerable adjustment, the directive is expected to exert a wider influence, affecting smaller companies through a "trickle-down effect."
Despite its challenges and obligations, the CSDDD offers several advantages for businesses, from establishing a level playing field and protecting reputation to enhancing long-term sustainability, risk mitigation, and resilience.
The next step for the CSDDD is its presentation for voting in the EU Parliament, expected to take place in mid-April.
The CSDDD is a testament to the EU's ongoing efforts to promote sustainable and responsible business practices. By setting stringent standards for due diligence and sustainability, the directive not only aims to protect the rights and well-being of individuals impacted by corporate operations but also to foster a more sustainable, resilient, and equitable business environment. As we anticipate its adoption and implementation, the CSDDD stands as a significant stride towards a sustainable future for all.
Bernd possesses extensive experience in strategic procurement, shaped by his tenure at Eckes-Granini, Symrise and DuPont de Nemours. Currently, he is focused on sustainable sourcing and supply chains, collaborating with the relatico team to develop practical software solutions. Additionally, Bernd runs his own agricultural business and is involved in supply chain projects globally.
