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Due diligence: Europe will finally have new rules on responsible business conduct

Date

24 Apr 2024

Sections

InfoSociety

Today, the European Parliament will be voting on new binding rules on making sure businesses behave responsibly.

This is a major victory for the Socialists and Democrats, who initiated this fight four years ago with an own initiative report, calling on the Commission to come forward with a proposal, and led the negotiations on behalf of the European Parliament.

The Corporate Sustainability Due Diligence Directive is the most ambitious legislation in the world to oblige companies, both inside and outside the EU, to take responsibility for the impact of their activities on human rights and the environment in their subsidiaries and value chains.

Lara Wolters, S&D MEP and European Parliament rapporteur for due diligence, said:

“We cannot continue to tolerate the use of forced labour and child labour, land grabbing, including from indigenous communities, pollution, and the destruction of the environment. With the vote on the due diligence law, we are finally holding large companies responsible for violations of human rights and environmental standards.

“This is a victory for all of us and it will have major implications around the world, stopping businesses from looking away from very real human misery and destruction. This is about more than business conduct; this is about values, and perhaps most of all, about humanity.

“Despite the last-minute changes imposed by the Council, the core elements of the directive remain untouched. The agreement sets a robust mandatory due diligence framework, well aligned with international standards, and with a revolutionary liability regime, which includes key access to justice measures that our Group defended so strongly.

“But we still have a long road ahead of us, and we hope that member states will swiftly and adequately transpose the directive. We strongly encourage the future Commission to quickly develop much-needed, robust and detailed guidelines to help companies, authorities and stakeholders implement the new due diligence obligations.

“People and planet must go before profit.”

Note to editor:

Follow the EP press conference(opens in a new tab) by S&D MEP Lara Wolters, EP rapporteur on due diligence, today at 15:00.

As of June 2024, European member states will have two years to transpose the new rules into their national law.  

The new rules will apply to companies as follows:

  • As of June 2027: for companies with over 5000 employees 
  • As of June 2028: for companies with over 3000 employees 
  • As of June 2029: for companies with over 1000 employees

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