EP vote on the corporate sustainability due diligence directive: The European Parliament failed to deliver workable due diligence rules

1 June 2023 - Commenting on the European Parliament’s adoption of its legislative resolution on the corporate sustainability due diligence directive, BusinessEurope Director General Markus J. Beyrer said: "The European Parliament failed to deliver workable due diligence rules".

"European companies want to be a part of the solution and to achieve more sustainable supply chains. Due diligence rules need to be clear, workable, uniform at the EU level, and not contradicting or overlapping with the other sustainability legislation.

We take note of progress made by the Parliament to bring EU’s due diligence rules in line with international standards, for example OECD. We hope the newly introduced language around harmonisation will translate into real uniformity to get 1 not 27 due diligence laws.

However, over-prescriptive rules of purely punitive nature that do not distinguish between procedural mistakes and actual damages remain a concern in the Parliament’s position. This could push European companies out of third countries at the expense of local communities and limiting access to raw materials essential for the EU’s sustainable transition.

We urge the European institutions to address in further negotiations the key issues around harmonisation, clearer terminology, proportionate enforcement and unnecessary interference with corporate governance notably the directors’ duties."

BusinessEurope with 35 other European business organisations issued their key recommendations for the next stages of the legislative process, read here.