· 2 min read
illuminem summarizes for you the essential news of the day. Read the full piece on Forbes or enjoy below:
🗞️ Driving the news: The EU has enacted new regulations for supply chain due diligence, known as the Corporate Sustainability Due Diligence Directive (CS3D)
• This law mandates that corporations be held legally accountable for environmental and human rights issues
• The CS3D also requires companies to implement policies and conduct risk assessments to mitigate harmful impacts
🔭 The context: The CS3D is a companion to the Corporate Sustainability Reporting Directive (CSRD), which requires transparency on ESG risks without mandating specific actions.
• The CS3D goes beyond this by imposing direct legal obligations
• The directive applies to companies with over 1,000 employees and €450 million turnover, with enforcement beginning in 2027
🌍 Why it matters for the planet: The directive aims to address environmental and social harms caused by global supply chains
• It introduces comprehensive accountability measures, including potential jail time for executives, thus incentivizing proactive steps toward sustainability
⏭️ What's next: The law awaits final approval by EU member states and will then be incorporated into national legislation
• It is expected to influence global corporate practices, as companies adapt to comply and pressure their supply chains to do the same
💬 One quote: "It’s now critical this law is properly implemented, enforced, and reviewed at the earliest opportunity to plug its many loopholes," says ClientEarth lawyer Amandine Van Den Berghe
📈 One stat: The number of companies affected by the directive was reduced from 16,300 to 5,400
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