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On 25 April 2023, the JURI committee, leading the EU Corporate Sustainability Due Diligence Directive (EU CSDDD)1 at the European Parliament, adopted a workable position more closely aligned with internationally recognised due diligence standards than the original proposal by the European Commission. The plenary of the European Parliament will vote on this position at the beginning of June.
The amendments agreed upon by the committee members pave the way for effective legislation on mandatory human rights due diligence (HRDD), a considerable achievement for Lara Wolters and her team leading on the file. While the position provides a solid legal environment for the promotion and support of HRDD, Fair Wear has a few recommendations related to our four main stipulations for effective legislation to strengthen it even further.
Fair Wear welcomes the inclusion of all six steps of the HRDD cycle and emphasis on a risk-based due diligence approach in Article 4 of JURI’s position. This is in line with tried and tested and internationally recognised principles and guidelines. The article thereby constitutes a clear legal basis for the effective implementation of HRDD.
Broadening the scope from companies with 500 or more employees to companies with 250+ employees is a significant step towards creating a meaningful impact. Yet over 90 % of companies in the textile and garment industry have fewer than 50 employees, and fragmentation is high – meaning that the leverage needed to achieve long-lasting, large-scale change is only possible through collaboration. Therefore, the directive should also apply to small and medium-sized companies.
The JURI position briefly mentions the option to adapt purchasing practices in articles 5, 7 and 8, acknowledging the effect of the behaviour of buying companies on working conditions. Yet, the evaluation and improvement of purchasing practices is an integral part of effective due diligence, given they are the root cause of many infringements in the value chain2.
Responsible purchasing practices, therefore, merit a stronger prominence in the directive. In line with the specific language across the position, such as regarding the risk-based approach, Fair Wear recommends a clearer emphasis on the company’s responsibility to identify and assess the impact that their own business models, as well as trading, procurement and pricing practices, have on working conditions.
We are pleased to see article 9 of the JURI position elaborate on developing grievance mechanisms, acknowledging their crucial role in remediation within the due diligence process. In facilitating exchange between stakeholders, grievance mechanisms are a vital source of information for a company’s risk assessment and platforms for learning what is considered an appropriate remedy by affected groups. Especially sectoral grievance mechanisms could go beyond mere complaints procedures in facilitating ongoing stakeholder engagement and establishing change in a systemic, rather than case-by-case, level.
At the same time, the article suggests two procedures, one related to notifications and the other to actual grievances. However, rather than offering a separate pathway, ‘notifications’ should mark the beginning of the remedy process within grievance mechanisms. Aligning with the UNGP and OECD guidelines will help create more clarity, offering one comprehensive mechanism.
Overall, the JURI position marks considerable progress towards effective mandatory human rights due diligence, especially in aligning more closely with already existing and proven international standards than the original proposal by the European Commission. The above recommendations will help strengthen this already ambitious base, ensuring that the directive has the intended impact on human rights and the environment.
 The EU Corporate Sustainability Due Diligence Directive is a legislative proposal at the EU that aims “to foster sustainable and responsible corporate behaviour and to anchor human rights and environmental considerations in companies’ operations and corporate governance”.