EU Corporate Sustainability Due Diligence Directive (CSDDD) Passed By EU Parliament: What Are The Implications?

On 24 April 2024, the European Parliament voted to adopt the long-awaited EU Corporate Sustainability Due Diligence Directive (CSDDD or the Directive). The Directive will introduce a duty on certain companies to undertake human rights and environmental due diligence. As the latest and arguably most significant new law to be introduced requiring businesses to conduct such due diligence in their own operations and value chains, the Directive will harmonize existing requirements across the EU and is likely to serve as a benchmark for other countries looking to enact similar legislation.

Background

Having first been proposed by the European Commission in 2022, the Directive was subject to provisional agreement by the European Parliament and EU Council in late 2023. However, during subsequent 'trilogue' negotiations between the three EU legislating institutions, further concessions were made to accommodate concerns of individual EU Member States, leading to a 'final