October 2022 – Last February, the European Commission published a proposal for a Directive on “corporate sustainability due diligence”. Now that the Council is examining the text and the debates in the European Parliament have started, Sherpa publishes its analysis and recommendations on a specific point: how does the Commission’s proposal address the issue of environmental and climate harms?
The Commission’s proposal was long overdue. In a context of environmental and climate emergency, this proposal raises crucial questions about how to address the obligations and liability of companies for environmental harms occurring in their global value chains. In its current version, however, the proposal falls short of what is required. Unlike the French Duty of Vigilance Law, the EU commission has adopted a particularly restrictive approach which tend to narrow the scope of companies’ obligations to a very limited set of environmental adverse impacts.
Sherpa presents its analysis which shows that the Commission’s approach seems particularly restrictive and raises several issues. Notably, it risks creating legal loopholes and blind spots regarding the type of environmental damage covered by the Directive. In addition, the draft has considerable shortcomings regarding the issue of climate change. The position paper also presents Sherpa’s recommendations on this specific topic.
To achieve its objectives, the European Duty of Vigilance should provide a broad material scope to environmental matters, covering all actual or potential damage to the environment and its components. Otherwise, the obligations enshrined in the Directive will be largely ineffective.