Forest Peoples Programme feedback to the European Commission consultation on its proposal for a Directive on Corporate Sustainability Due Diligence

On 23 February 2022, the European Commission adopted a proposal for a directive on corporate sustainability due diligence. The proposal aims to foster sustainable and responsible corporate behaviour throughout global value chains. The proposed directive will require EU member states to enact legislation to require (some) companies to put in place due diligence processes to identify and, where necessary, prevent, end or mitigate adverse impacts on human rights and on the environment that are linked to their activities.  

From March to May 2022, the European Commission opened a public consultation allowing stakeholders to submit their feedback on the proposal, sharing their views on gaps and ways to improve the initiative.

FPP submitted comments to the consultation, focussing particularly on how the directive could improve respect for and protection of the rights of indigenous and forest peoples.

Read the full paper here 

Our key recommendations for the proposal include:

• Include protection of the full range of human rights in the directive, by defining adverse human rights impacts to be addressed by companies by reference to all international human rights instruments (as opposed to selective rights). Expand the current list of instruments to include ILO Convention No. 169, the UN Declaration on Human Rights Defenders, the American Convention on Human Rights and the African Charter on Human and Peoples Rights, among other relevant instruments.
• Guarantee coverage of the full value chain by explicitly requiring companies to conduct due diligence on their full value chain, and on all their business partners, regardless of the existence of an “established business relationship”.
• Make clear that when neither prevention nor adequate mitigation is possible, an activity should not go ahead. Provide more guidance on when mitigation is (in)adequate – at a minimum this should exclude any impacts involving irreparable, serious, repeated or ongoing harm, and make clear that determination of whether mitigation is adequate should be made in consultation with those whose rights may be affected.
• Develop a centralised system for receiving substantiated concerns, conducting preliminary assessment of them and distributing them to member states’ competent authorities, including providing relevant translation and other support where necessary.
• Broaden the civil liability provisions to cover the full value chain, require member states to provide for injunctive relief as well as monetary damages as remedies in these procedures, and revising the defence available to companies to ensure that companies are only entitled to a defence where they have taken genuine efforts to identify and address impacts. Reverse the burden of proof for establishing the breach of a company’s obligations, causality between the breach, the adverse impacts, and the damage. Add requirements for member states to ensure potential language barriers, legal costs, time limits, legal standing for bringing forth claims and access to evidence are lifted.
• Extend the scope of due diligence obligations to all companies regardless of size, or at an absolute minimum include all large companies captured by the Corporate Sustainability Reporting Directive, as well as high-risk small and medium enterprises. Clarify the approach for calculating EU turnover for non-EU companies, making sure all EU subsidiaries within a single corporate group report a consolidated turnover in the EU.
• Make consultation with affected or potentially affected stakeholders, and particularly indigenous and forest peoples, an obligation for all companies as part of the due diligence process.
• Improve the coverage of environmental impacts by also requiring companies to take into account any material adverse environmental impact, and include a non-exhaustive catalogue of (other) environmental impacts to which corporate behaviour can be linked.

Read the full feedback here for more details.