Statement from Sanda Ojiambo on the European Commission’s Proposal for a Corporate Sustainability Due Diligence Directive

Sanda Ojiambo, Assistant Secretary-General and CEO of the world’s largest corporate sustainability initiative welcomes further progress on the European Commission’s directive for Corporate Sustainability Due Diligence; calls for greater alignment with key international standards on sustainability due diligence adopted by the UN and the OECD, especially the UN Guiding Principles on Business and Human Rights. 

UNITED NATIONS, New York, 23 May 2022 — Today, the feedback round for the proposal for the European Commission’s Corporate Sustainability Due Diligence directive closes, marking an important milestone in the development of the landmark legislation.

As the world’s largest sustainability initiative, the United Nations Global Compact welcomes the European Commission’s commitment to advancing the protection of human rights and the environment through due diligence. The UN Global Compact looks forward to the contributions of this multi-stakeholder feedback and welcomes the strengthening of the draft directive through greater alignment with key international standards on corporate sustainability due diligence, including the UN Guiding Principles on Business and Human Rights (UNGPs), the ILO Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy (MNE Declaration) and the OECD Guidelines for Multinational Enterprises (OECD MNE Guidelines).

Adopted by the European Commission on 23 February, the stated aim of the draft directive is to “ensure that companies active in the internal market contribute to sustainable development… through the identification, prevention and mitigation, bringing to an end and minimization of potential or actual adverse human rights and environmental impacts connected with companies’ own operations, subsidiaries and value chains.” It further proposes that companies that fail to conduct effective due diligence or to implement preventative or remediation measures face both administrative penalties and civil liability. The feedback received by the European Commission by the close of today will be summarized and presented to the European Parliament and Council and will feed into the legislative debate.

Amidst the backdrop of an ongoing global pandemic, widening inequalities and the climate emergency, the business contribution to responsible recovery, sustainable development and a just transition must go hand-in-hand with ensuring respect, dignity and equality for all people. The draft directive on due diligence from the European Commission is a welcome step in advancing the “smart mix of measures” — both voluntary, mandatory, national and international established by the UNGPs — and fostering business respect for human rights in accordance with our Ten Principles.

The UN Global Compact previously announced our full support for all efforts to develop legislation on mandatory human rights and environmental due diligence in November 2020. Our internal research has shown that while more than 90 per cent of its business participants have human rights policies in place, only 18 per cent of these participants conduct human rights impact assessments. 

Businesses are looking to the UN Global Compact and our Local Networks for guidance, and in response, we are committed to helping companies prepare for and adapt to emerging legislation on due diligence in the EU and elsewhere as the mandatory wave continues to gain momentum.

To support an enabling environment for business respect for human rights, the UN Global Compact will launch a Business and Human Rights Accelerator programme in 2023, with the recruitment period commencing in September 2022. The Accelerator will focus on helping businesses take voluntary measures to respect human rights by enacting an ongoing human rights due diligence process and will serve as a complement to the growing momentum towards mandatory due diligence legislation.
 

ABOUT THE UNITED NATIONS GLOBAL COMPACT

As a special initiative of the UN Secretary-General, the United Nations Global Compact is a call to companies everywhere to align their operations and strategies with Ten Principles in the areas of human rights, labour, environment and anti-corruption. Our ambition is to accelerate and scale the global collective impact of business by upholding the Ten Principles and delivering the Sustainable Development Goals through accountable companies and ecosystems that enable change. With more than 12,000 companies and 3,000 non-business signatories based in over 160 countries, and 69 Local Networks, the UN Global Compact is the world’s largest corporate sustainability initiative — one Global Compact uniting business for a better world.

For more information, follow @globalcompact on social media and visit our website at unglobalcompact.org.