As (mandatory) Human Rights and Environmental Due Diligence (HREDD) becomes a defining feature of responsible business conduct in Europe and beyond, the goal is clear: stronger implementation, more resilient supply chains, and ultimately improved outcomes for workers and businesses alike. The challenge is not defining what impactful due diligence looks like but delivering it in practice.
From 'Trust' to 'Impact'
In today’s global economy, supply chains are long, multi‑tiered and characterised by power imbalances. Despite growing awareness and effort, human rights and environmental violations persist across sectors. Our experience at Fair Wear has shown us that companies cannot tackle this alone; collaboration based on expertise, trust and accountability between key industry stakeholders is needed to address systemic challenges and create impact on the ground. But collaboration does not happen automatically. It often follows a distinct pattern:
- Transparency and accountability create trust between companies, suppliers and stakeholders
- Trust improves engagement, encouraging partners to openly share information
- This way, engagement enables collaboration by improving understanding of root causes and effective actions, particularly on sensitive or complex issues
- Collaboration makes due diligence operational, as effective due diligence requires concerted efforts from actors across the supply chain
- Stronger collaboration leads to better outcomes, for both workers and businesses
In practice, this means that when supply chain actors are confident that information will be used fairly and commitments will be upheld, they are more willing to engage. This creates the conditions needed to identify risks earlier, design more effective interventions, and implement improvements consistently over time. Trust, therefore, is not the end goal but a critical enabler of the collaboration required to deliver impact.
How MSIs support trust in due diligence
Over recent decades, industry and Multi-Stakeholder Initiatives (MSIs) have emerged in response, bridging the trust-gap by bringing together brands, suppliers, workers, local NGO’s and policymakers. Distinguished by their inclusive governance structures, MSIs are uniquely positioned to address structural drivers of harm, rather than focusing solely on individual company compliance.
How MSIs contribute:
- Facilitating collaboration in a pre competitive space: MSIs enable collective problem solving and learning across supply chain actors, helping to overcome fragmented or isolated approaches and delivering the required innovation necessary to address contemporary issues.Example: Fair Wear’s work on Responsible purchasing practice
- Harmonising standards and raising the bar: By defining ambitious standards together with stakeholders, MSIs help prevent a race to the bottom and signal what good due diligence looks like in practice.Example: The Meaningful Stakeholder Engagement Framework
- Collecting and validating data: MSIs generate stakeholder validated data on sector-risks and tested approaches that supports company decision making and informs policymakers and regulators.Example: Fair Wear’s Onsite assessments
- Creating clear pathways for companies: By providing practical tools and guidance across the HREDD cycle, MSIs help companies focus their resources on impact rather than reinventing systems from scratch.Example: The Fair Price App
- Holding companies accountable: MSIs hold companies accountable through transparency; openly communicating on a company’s practices and compliance with its normative standards.Example: Fair Wear’s Grievance Mechanism
Towards credible and transparent use of fitness criteria
Engagement with MSIs is a supplementary measure, not a shortcut. With the right information, companies can select the MSI(s) best fitted for supporting them in creating the most impact in their supply chain.
For companies, the responsibility lies in using the fitness criteria thoughtfully as part of their own due diligence. When applied in this way, both MSIs and fitness criteria can play a powerful role in strengthening trust and delivering impact across supply chains.
You can read the full policy statement here.