Answer given by Mr Reynders on behalf of the European Commission
14.3.2024
The liability regime of the proposed Corporate Sustainability Due Diligence Directive (CSDD)[1] has been carefully calibrated. Companies would have legal certainty and would not be held liable for adverse impacts that are caused by others without their implication. Civil liability would be an essential element to ensure access to justice by victims of adverse impacts.
The CSDD aims to foster sustainable and responsible corporate behaviour throughout the companies’ chains of activities, irrespective of where they are located.
Companies will be required to take a risk-based approach in their due diligence and where relevant prioritise the adverse impacts to be addressed based on severity and likelihood.
Therefore, if a company concludes that EU supply chain business partners present lower risk, they can deprioritize such partners.
The CSDD only targets large companies that have the necessary capacities and resources to carry out due diligence and bear the compliance costs.
The proposed Directive besides the risk-based approach, includes a series of measures which aim at facilitating compliance and limiting the burden on companies, such as the possibility to use industry schemes and third-party verification.
Furthermore, as the CSDD is not a product-based instrument but a corporate governance measure like already existing national due diligence laws, an approach based on purchase value would not be appropriate.
- [1] Proposal for a directive of the European Parliament and of the Council on Corporate Sustainability Due Diligence and amending Directive (EU) 2019/1937 (COM/2022/71 final), https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:52022PC0071