On the proposal for a directive of the European Parliament and of the Council on Corporate Sustainability Due Diligence and amending Directive (EU) 2019/1937
IMCO-AD-736656
Committee on the Internal Market and Consumer Protection · Rapporteur: Deirdre Clune
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The Committee on the Internal Market and Consumer Protection proposes amendments to the proposed directive on corporate sustainability due diligence. It wants more harmonisation, a risk-based approach, and stronger support for small and medium-sized enterprises (SMEs).¶¶¶ The amendments would stop member states from adopting diverging national rules, require companies to use a risk-based approach, and let parent companies carry out due diligence for their subsidiaries at group level.¶¶¶ They would strengthen rules on complaints, stakeholder engagement, monitoring, reporting, supervisory authorities and sanctions, and add a national single point of contact in each member state.¶¶¶
Committee position. The committee calls on the Committee on Legal Affairs, as the committee responsible, to take into account its amendments. It proposes to increase harmonisation, preserve a risk-based approach, streamline procedures and provide more support to SMEs.¶¶¶
Key points
- The opinion supports the proposal's aim of fostering sustainable and responsible corporate behaviour throughout global value chains and says the new rules would bring legal certainty and a level playing field.¶
- It seeks to increase harmonisation and avoid fragmentation, preserve a risk-based approach, streamline procedures and give more support to SMEs.¶
- It proposes that member states must not maintain or introduce national provisions diverging from the directive, except for Articles 22 and 25.¶¶
- It would let parent companies fulfil due diligence obligations on behalf of their subsidiaries at group level, without absolving the subsidiary of its own responsibility.¶
- It would require companies to conduct due diligence on the basis of a risk-based approach, defined by the likelihood, severity and urgency of impacts and the nature and context of the company's operations.¶¶
- It would require companies to engage effectively, safely and meaningfully with stakeholders, and the Commission to adopt guidelines on such engagement.¶
- It would strengthen the complaints mechanism, requiring it to be safe, equitable, accessible and transparent, allowing anonymous and confidential complaints, and requiring companies to inform complainants of steps taken.¶¶¶
- It would require companies to carry out periodic assessments at least every 12 months, in consultation with stakeholders, and to disclose relevant information on the outcome.¶
- It would require companies not subject to Directive 2013/34/EU reporting to publish an annual statement by 30 April each year, and the Commission to provide for simplified reporting.¶¶
- It would require the Commission to issue guidelines, particularly taking into account SMEs' needs, and to enable administrative and financial assistance.¶¶
- It would require each member state to designate a national single point of contact to guide companies and support cross-border cooperation, and the Commission to provide a single portal.¶
- It would require supervisory authorities to have appropriate knowledge and skills, publish annual reports, act proportionally, and ensure sanctions are harmonised through the European Network of Supervisory Authorities.¶¶¶
Who is affected
- Companies in scope, which would have to apply a risk-based approach, engage with stakeholders, and report on due diligence.¶¶¶
- SMEs, which would receive targeted support, guidance and simplified reporting, and benefit from a national single point of contact.¶¶¶
- Parent companies and their subsidiaries, which could use group-level due diligence.¶
- Member states, which must not adopt diverging national rules, must designate a single point of contact, and must ensure supervisory authorities have the right skills.¶¶¶
- Persons and organisations affected by adverse impacts, who could submit complaints and receive information on actions taken.¶¶
Figures and deadlines
- At least every 12 months, for reassessing business relationships and for monitoring assessments.¶¶
- By 30 April each year, for publishing the annual statement.¶
- No longer than 6 months, for the force majeure derogation from suspending or terminating business relationships.¶¶
- 7 years after the date of entry into force of this Directive, for the Commission's first implementation report, and every three years thereafter.¶
- 3 years after the date of entry into force of this Directive, for the Commission's review of the impact on SMEs.¶