The European Parliament and Council Directive on Corporate Sustainability and Mandatory Compliance (Corporate Sustainability Due Diligence) is designed to strengthen corporate accountability for their impact on people and the planet. This directive requires companies not only to adhere to stricter standards in their operations but also to conduct more thorough checks on their supply chains. It also amends Directive (EU) 2019/1937, which concerns the protection of persons who report breaches in the European Union.

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Main objectives:

Enhancing sustainability. Obligates companies to conduct due diligence in the context of sustainability to ensure that their operations and supply chains do not negatively impact social and environmental standards.

Protecting human rights. Requires companies to take measures to prevent human rights violations that may arise from their operations.

Environmental protection. Includes responsibilities for preventing environmental damage and reducing the impact on climate change.

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Amendments to Directive 2019/1937:

Strengthening the protection of whistleblowers. Ensures that individuals who report breaches in sustainability and social or environmental norms are protected from retaliation.

Tasks:

Corporate policy revision. Companies will need to review their policies and procedures to implement due diligence systems and ensure compliance with new requirements.

Increasing transparency. Companies must ensure greater transparency of their operations and supply chains, as well as regularly report on the measures taken to support sustainability and ethical standards.

Stakeholder engagement. It is important to collaborate with local communities, human rights organizations, and environmental groups to increase trust and effectiveness in implementing sustainability policies.

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This directive aims to create a more sustainable and responsible economy in the EU, elevating the ethical and environmental accountability of companies.