CIDSE welcomes a landmark announcement by the EU Justice Commissioner Didier Reynders that EU legislation on mandatory human rights and environmental due diligence for corporations will be developed. At a webinar organised by the European Parliament’s Responsible Business Conduct Working Group, Commissioner Reynders committed to the development of a legislative initiative in early 2021 and stated that the legislation will be cross sectoral and mandatory with “the capacity to enforce and implement”. This is a major development and an important move beyond voluntary measures which have been ineffective in ensuring communities are protected from business-related human rights violations.
Importantly, Commissioner Reynders highlighted the need for sanctions: “It’s important that we have the possibility to sanction with liability on the civil, criminal and administrative level the disrespect of the regulation.”. CIDSE member organisations who work with human rights defenders and communities impacted by corporate human rights abuses throughout the world, welcome this development to provide access to justice for victims of violations by EU companies and investors.
The decision is based on the results of the recently published study on due diligence requirements through the supply chain which confirmed that voluntary measures are failing and that there is an urgent need for regulatory action at EU level in order to protect workers, communities, and the environment from systematic, ongoing and worsening human rights and environmental impacts linked to the global supply chains of businesses and financial institutions. The study reveals that “Only one in three businesses in the EU are currently undertaking due diligence which takes into account all human rights and environmental impacts.” And only 16 percent of companies undertake due diligence measures beyond tier one. This is however the requirement of the UN Guiding Principles on Business and Human Rights.
Reynders acknowledged that the COVID-19 crisis reveals EU’s dependence on fragile supply chains in third countries. “Businesses which have better risk mitigation processes across their supply chains cause less harm to people and weather the crisis better.” The Coronavirus has further revealed poor human rights practices in the absence of legal regulation and has once again exposed the fragility of supply chains, that have resulted in the mass unemployment of workers who can least afford it due to the cancellation of orders and refusal by some companies to pay for already produced goods. This unjust way of conducting business is a sharp reminder as to why mandatory human rights and environmental due diligence legislation is necessary. CIDSE also welcomes the Commissioner’s speech on his clear intention to bring forward this legislation as a part of the EU’s COVID-19 recovery plan alongside the European Green Deal, noting that “sustainable includes environmental, human rights and social issues”.
Businesses agreed that due diligence “would create legal certainty and a single harmonized standard in the place of different approaches in the member states.” Members states who currently have national due diligence, such as France, and those who are currently developing such legislation such as Denmark and Germany, will find that their corporations now have a more level playing field with other EU corporations. The Federal Ministry of Labour and Social Affairs of Germany affirmed support for EU legislation, and suggested a focus on this in the upcoming German presidency.
This is crucial step for the rights of land and environmental defenders and communities resisting corporate activities by EU companies and investment. It should be complemented by the active participation of the European Union in the negotiations of a Legally Binding Instrument on Business and Human Rights at the United Nations, this year entering its sixth session.
See also op-eds published by a coalition of Belgian NGOs, including CIDSE members, Broederlijk Delen and Entraite et Fraternité:
– “Entreprises et droits humains: ce que révèle le coronavirus” in Le Soir; and
– “Bedrijven en mensenrechten: de lessen van de pandemie” in MO – Mondiaal Niews
Joint civil society letter to Didier Reynders, EC Justice Commissioner, 23 June 2020