The signatories express concern about the setbacks to the twice-delayed proposal, which is now expected later this month.
The statement, signed by companies and investors from various industries and countries, including many SMEs and some financial institutions, outlines five key principles to be included in the legislation to make it effective:
- Alignment of the legislation with the UNGPs to cover all businesses operating in the EU market, regardless of sector and size;
- Due diligence obligation that extends across the full value chain;
- Mandatory requirements which go beyond tick boxing, address irresponsible purchasing practices, and are embedded in appropriate governance structures including at board level;
- Effective and safe stakeholder engagement as an integral part of due diligence; and
- Credible accountability mechanisms, including strong civil liability provisions
The statement is initiated by Business & Human Rights Resource Centre, which monitors national and regional developments towards mHREDD legislation. In 2021, mHREDD laws were passed in Germany and Norway, and similar laws are under consideration in the Netherlands and Finland. The EU’s Sustainable Corporate Governance initiative can play a significant role in creating a Europe-wide level playing field for mHREDD and corporate accountability and, crucially, drive better outcomes for people and the planet across global value chains.
In 2020, Triodos Bank supported a call from 49 Dutch companies for a legal framework for due diligence legislation to prevent human rights violations or negative impacts on the environment. Tony’s Chocoloney was the initiator of this call.