EU Anchors Human Rights and Environment in Company Supply Chains

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🗞️ Driving the news: The European Parliament recently adopted the Corporate Sustainability Due Diligence Directive (CSDDD), a major legislative step aimed at ensuring that companies operating in the EU adhere to strict human rights and environmental standards throughout their supply chains

🔭 The context: Originally met with resistance from key member states, the directive mandates stringent due diligence processes to prevent violations of environmental and human rights protections
• It encompasses both EU and certain large non-EU companies, with a phased implementation period spanning three to five years

🌍 Why it matters for the planet: The CSDDD seeks to mitigate the adverse impacts of global supply chains on the environment and human rights
• By enforcing sustainability criteria, the directive encourages businesses to adopt practices that are more ecologically sound and socially responsible

⏭️ What's next: After formal endorsement by the Council and publication in the Official Journal of the EU, the directive will take effect 20 days later. EU member states will have two years to incorporate the directive into national law, with full application for larger companies by mid-2027

💬 One quote: "This directive is a real game changer, It sets new benchmarks for corporate responsibility and sustainability across Europe and potentially beyond," notes the KPMG team

📈 One stat: Approximately 5,500 companies will be impacted by this directive, representing a reduction of nearly 70% compared to initial proposals

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