The EU Parliament’s Position on the Due Diligence Directive

The European Parliament’s Legal Affairs Committee (JURI) adopted a report with recommendations to the Commission on corporate due diligence and corporate accountability. Presented by Lara Wolters (S&D), the report highlights the position of the European Parliament regarding the upcoming Sustainable Corporate Governance Initiative, due in June. The Directive is expected to have a scope that includes large companies, listed SMEs, and high-risk SMEs. According to the report, companies will have to “identify, assess, prevent, mitigate, cease, monitor, communicate, account for, address and remedy the potential and/or actual adverse impacts on human rights, including social, trade union and labour rights, on the environment, including the contribution to climate change, and on good governance, in its own operations and its business relationships in the value chain.”

The Directive should also ensure the appropriate involvement of trade unions or workers’ representatives to avoid the risk of marginalize critical stakeholders in the due diligence process. The future EU regulation should also guarantee alignment with future initiatives, such as the non-financial reporting directive (NFRD).

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