Mandating Human Rights Due Diligence: EU Council Reaches Agreement on Corporate Sustainability Due Diligence Directive

On 15 March, the EU Council has reached an agreement on the Corporate Sustainability Due Diligence Directive (CSDDD), a landmark legislation aimed at promoting responsible business conduct. The CSDDD sets out a uniform framework mandating the largest companies operating within Europe to conduct human rights and environmental due diligence throughout their value chains. To ensure support from all member states, the CSDDD has undergone several modifications, including on scope. The new threshold which companies fall under the CSDDD was raised from 300 million EUR to 450 million EUR. The law will now cover around 5’500 European companies.

With the Council’s endorsement, the EU has sent a strong signal that big businesses in Europe can no longer ignore negative human rights impacts – especially in conflict-affected and high risk-areas (CAHRAs). The CSDDD explicitly recognises the higher likelihood and severity of human rights abuses in CAHRAs, emphasising the need for companies to incorporate this into their policies and risk management systems (Preamble paragraph 30(b)). The CSDDD also highlights the importance of aligning codes of conduct and processes with international humanitarian law (IHL) as outlined in the Geneva Conventions and their Additional Protocols.  Finally, the CSDDD explicitly references the right to life and the prohibition of torture, cruel, inhuman and degrading treatment in relation to “private or public security guards protecting the company's resources, facilities or personnel” (Annex Part 1, paragraph 1-2).

In implementing the CSDDD, companies will look for directions to ensure compliance with the new obligations. The DCAF-ICRC Partnership’s tools and guidance on business, security, and human rights in CAHRAs can provide significant support in addressing security-related risks and human rights challenges. The Security and Human Rights Toolkit serves as a go-to resource for company security managers, compliance officers, human rights departments, and operational field staff. It is already being used by companies in complying with the German Supply Chains Due Diligence Act.

Developed by the ICRC, Australian Red Cross, and RMIT University, the Compendium of Resources on Responsible Business Conduct in Armed Conflict also provides guidelines, tools, and training modules designed to support companies in implementing responsible business conduct and ensuring they do not harm local communities while effectively navigating the complex intersections of security, IHL, human rights, and business operations.

On 19 March, the European Parliament's Committee on Legal Affairs also voted in favour of the CSDDD. The CSDDD must now be voted on by the European Parliament’s plenary before entering into law.

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