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illuminem summarizes for you the essential news of the day. Read the full piece on Forbes or enjoy below:
🗞️ Driving the news: On March 15, the European Council approved the Corporate Sustainability Due Diligence Directive (CSDDD), which introduces legal obligations for companies to address environmental and human rights issues within their supply chains
• The directive, now pending European Parliament approval, has been significantly diluted from its initial proposal, affecting fewer companies than originally planned
🔭 The context: The CSDDD aims to establish a standard for corporate sustainability due diligence within the EU, focusing on environmental, climate change, and human rights concerns
• This directive holds companies accountable not only for their direct actions but also for those of their subsidiaries and entire supply chain
• The recent approval followed 45 days of intense negotiations, reflecting a tumultuous journey marked by political pressure and sustainability advocates' anxieties
🌍 Why it matters for the planet: The directive is a critical step towards ensuring corporations operating in the EU are responsible for their environmental impact and human rights practices
• By making companies accountable for their supply chains, the EU aims to reduce negative environmental impacts and improve human rights globally
• However, the watered-down version means fewer companies will be under its purview, potentially limiting its effectiveness.
⏭️ What's next: The directive now moves to the European Parliament for approval, where it must pass through the legal affairs committee (JURI)
• The final text has been adjusted to include companies with at least 1,000 employees and a €450 million turnover, scaling back its original scope
• This adjustment, along with a phased implementation plan, indicates a more gradual approach to enforcing due diligence standards
💬 One quote: "This is a historic step towards more sustainable and ethical business practices within the EU and beyond," says Axel Voss, rapporteur for the European Parliament to the CSDDD.
📈 One stat: The revised criteria are estimated to impact about 0.05% of businesses in the EU, significantly reducing the scope from the initial proposal.
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