However, Alexander Kohnstamm, executive director of Fair Wear Foundation told Just Style exclusively that a further delay is in nobody’s interest and the many European companies that already take their due diligence seriously should be acknowledged.
He said: “The EU Council’s vote on CSDDD has been postponed until Wednesday. We call on all involved, the Belgian EU Presidency in particular, to ensure it passes swiftly.”
Based on the voting mechanisms at the EU level, a “qualified majority” is when 55% of member states, representing at least 65% of the EU population, vote in favour of new legislation.
Belgian media outlet Euractiv quoted a letter sent to to business associations from German finance minister Christian Lindner and justice minister Marco Buschmann, both members of the country’s Free Democratic Party (FDP).
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The FDP ministers stated they were against the introduction of the CSDDD based on concerns about the potential “administrative burden” it may entail, at a time when both the EU and national governments claim to be seeking to reduce red tape.
The letter also claimed the CSDDD liability regime “represents a greater burden” compared to the German Supply Chain Due Diligence Act, which does not contain a liability regime, and suggested the CSDDD would place an additional burden on companies.
Lindner also recently posted on X (formerly Twitter) that the CSDDD would put a “massive burden on companies without secure progress for human rights and the environment”. He added: “Germany is obviously anything but alone with its concerns.”
Non-profit Human Rights Resource Centre (BHRC) shared the translated version of the letter from 22 German authorities, urging the German Chancellor to secure the compromise reached on CSDDD in December 2023.
It read: “As large, medium-sized and small companies and their networks, we are very concerned that German support for the CSDDD could still be withdrawn in the final approval process. The political compromise on the CSDDD from December last year is based on the UN and OECD standards and thus builds on guidelines that responsible companies have been using as a reference for years.
“In our view, the requirements of the CSDDD are appropriate and feasible. The CSDDD offers a historic and, at present, the only chance for an EU-wide level playing field. Especially for German companies who comply with the German Supply Chain Act, a Europe-wide regulation means that competitive advantages at the expense of people and the environment will finally be prevented. We are therefore deeply concerned that a German abstention is currently being considered.”
The German organisations added that the EU has undergone a four-year-long democratic legislative process on the CSDDD, during which the perspectives of various stakeholders were included and compromises were reached.
The letter asks Chancellor Olaf Scholz to safeguard this democratically achieved compromise and thereby provide companies with legal certainty and fair competitive conditions.
Kohnstamm believes the heavily negotiated compromise for CSDDD is in the interest of workers, the environment and businesses.
Kohnstamm said: “As the most recent letter from German corporates again shows, industry also stands to benefit from the ambition and the clarity that the draft directive would provide throughout Europe and supply chains producing for the EU.”
He added: “The unison calls from responsible businesses and civil society must be heeded.”
Recently, the Ethical Trading Initiative (ETI) and Business and Human Rights Resource Centre (BHRC), along with 300 other organisations spanning various industries, also sent a letter to the authorities in support of the EU’s due diligence directive, calling it a crucial instrument for establishing a level playing field across the EU.