Making human rights due diligence a legal requirement for companies including systems to identify, assess, mitigate or manage human rights risks and impacts to improve that process over time and to disclose the risks and impacts, the steps taken and the results.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity agrees that an EU legal framework is needed.
In response to question 2, the entity states that ‘Reform needs to carefully consider the differences between Member States. For example there is no common definition of Director, Board and duty of care. The heterogeneity of rules and structures means that EU-level interventions need to focus on a principles-based and risk-based approach that establishes a baseline for companies in every Member State, with flexibility above that baseline. This is important also because legal differences reflect differences in how stakeholders cooperate at local level, and the extent to which corporate governance can drive substantial change will depend on the effective cooperation of all stakeholders in the ecosystem.’
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity welcomes, ‘the European Commission’s proposal for a Directive on Corporate Sustainability Due Diligence (CSDDD) as a much needed step to accelerate the transition towards more sustainable business.’ In suggesting to align with the UNGPs regarding the content of the due diligence duty, PwC IL actively calls for a stronger legislation.
The entity states that: ‘We support the alignment of the proposal with United Nations Guiding Principles on Business and Human Rights. We encourage the co-legislators to further look into aligning the proposal with the UN global framework , in particular with regard to operational principles for the corporate due diligence policy and meaningful stakeholder dialogue for companies to better identify their adverse impacts.’
Requiring Human rights due diligence of all companies, regardless of sector and size, while still reflecting their individual circumstances.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity prefers option 1 and agrees that a general due diligence duty should be defined at the EU level and be applicable across all sectors, supply chain due diligence should be considered as a critical component of risk management, and due diligence rules should also apply to certain third-country companies which are not established in the EU.
In response to question 15, the entity states that it prefers ‘Option 1. “Principles-based approach”: a general due diligence duty based on key process requirements should be defined at EU level regarding identification, prevention and mitigation of relevant human rights, social and environmental risks and negative impact. These should be applicable across all sectors. This could be complemented by EU-level general or sector specific guidance or rules, where necessary.’ In response to question 14, the entity states that: ‘Supply chain due diligence should be considered a critical component of the company’s risk management, to make sure that ESG risks are mitigated and not simply externalized to less scrutinized companies. Therefore, it should be addressed and reported on as a key risk by management and supervisory bodies.’
In response to question 17, the entity states that: ‘To ensure the level playing field, transparency and governance requirements or equivalent home country requirements should apply to companies that sell goods or provide services in the EU competing with EU companies.’
Implementing an enforcement mechanism where companies fail to carry out due diligence as described.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity is in favour of enforcement mechanisms.
In response to question 19, the entity supports ‘Supervision by competent national authorities based on complaints (and/or reporting, where relevant) about non-compliance with setting up and implementing due diligence measures, etc. with effective sanctions (such as for example fines); Supervision by competent national authorities (option 2) with a mechanism of EU cooperation/coordination to ensure consistency throughout the EU’.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity suggests that the EU should consider strengthening the enforcement aspects of directors duty on due diligence and to remove existing obstacles to this.
The entity states: 'In addition, we encourage the EC and co-legislators to give further consideration to the enforcement aspects of Directors duties and possible obstacles and limitations of the current enforcement system across the EU.'
Including in the duties of directors and company law obligations to avoid human rights impacts or “harms”.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity agrees to some extent on the corporate directors’ legal duty to identify its stakeholders and interests; to management the risks, and to identify the opportunities arising from promoting stakeholders’ interests.
In response to question 6, the entity indicates that ‘Transparency and governance in relation to business continuity and the sustainability of the business model could be enhanced. As part of their fiduciary duty, we would recommend that Boards, and in particular audit committees be required to actively oversee that management has established effective systems and controls relating to the viability of the company, the risk of fraud and other key risks faced by the company which may negatively impact its stakeholders. The Board could be asked to provide a public statement or report about the results of these oversight activities. An EU framework would be useful to ensure level playing field across capital markets.’
In response to question 7, the Entity indicates that ‘Boards will also become accountable to broader stakeholders and guidance on a minimum non-exhaustive framework of risks to be assessed by the directors and reported by each company may be a useful supplement’.
In response to question 8, the Entity states that ‘Directors should remain free to make decisions, take risks and compete effectively in the marketplace within a transparent and principles-based framework.’
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity supports introducing director's duties and suggests linking them to reporting requirements.
The entity recommends: 'introducing further guidance under article 5 for companies to implement a ‘three lines’ model, including risk indicators and different layers of controls, so that the company can improve the rigour of the risk management approach and demonstrate that it has a robust system in place ... Directors have the primary responsibility for establishing effective systems and controls relating to the viability of the company and key risks which may negatively impact its stakeholders. This responsibility and accountability would be reinforced if Directors were asked to publicly report with a statement on their oversight activities. In addition, we encourage the EC and co-legislators to give further consideration to the enforcement aspects of Directors duties and possible obstacles and limitations of the current enforcement system across the EU.'
Require companies to provide grievance mechanisms for all stakeholders including those in the value chain.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity agrees to some extent on the requirement for directors to establish or use existing consultation channels for engaging with stakeholders. The entity acknowledges the importance of stakeholder engagement; however, it has not mentioned the requirement for using consultation channels or grievance mechanisms.
In response to question 20a, the entity indicates that: ‘Stakeholder engagement supports company’s due diligence to prevent the risks and harms to human rights and the environment. Directors need to engage with, and listen to, all stakeholders.’ However, it has not mentioned consultation channels or mechanisms. The entity has not responded to question 20c.
Enabling judicial enforcement with liability and compensation in case of harm caused by not fulfilling the due diligence obligations.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity supports option 2 and option 3.
In response to question 19a, the entity states that it supports: ‘Supervision by competent national authorities based on complaints (and/or reporting, where relevant) about non-compliance with setting up and implementing due diligence measures, etc. with effective sanctions (such as for example fines); Supervision by competent national authorities (option 2) with a mechanism of EU cooperation/coordination to ensure consistency throughout the EU'.
Require companies to implement a due diligence process covering their value chain to identify, prevent, mitigate and remediate human rights impacts and improve that practice over time.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity agrees that an EU legal framework is needed.
In response to question 2, the entity states that, ‘an EU legal framework is needed’, and, ‘Reform needs to carefully consider the differences between Member States…This is important also because legal differences reflect differences in how stakeholders cooperate at local level, and the extent to which corporate governance can drive substantial change will depend on the effective cooperation of all stakeholders in the ecosystem.’
In response to question 3, the entity chooses the option 1 and 5, stating: ‘Ensuring that the company is aware of its adverse human rights, social and environmental impacts and risks related to human rights violations other social issues and the environment and that it is in a better position to mitigate these risks and impacts; levelling the playing field, avoiding that some companies freeride on the efforts of others; increasing legal certainty about how companies should tackle their impacts, including in their value chain’.
In response to question 14, the Entity agrees that supply chain due diligence should be addressed and reported on as a key risk, however, has not directly agreed to the definition. The entity indicates that it is important to differentiate the level of governance from the level of direct regulation when considering the cost and proportion of implementation.
In response to question 15, the Entity chooses the option 1, ‘Principles-based approach’.
Require that companies identify their stakeholders and their interests.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity agrees to some extent on the importance of stakeholder engagement in due diligence to prevent risks and harm to human rights.
In its response to question 20a, the entity agrees to some extent that: ‘Stakeholder engagement supports company’s due diligence to prevent the risks and harms to human rights and the environment. Directors need to engage with, and listen to, all stakeholders. They should draw on feedback from external and internal stakeholders…’
Require directors to establish and apply mechanisms or, where they already exist for employees for example, use existing information and consultation channels for engaging with stakeholders.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity acknowledges stakeholder’s engagement supports company’s due diligence and considers that the company should include stakeholder engagement in non-financial reporting.
In response to question 20a, the entity acknowledges that stakeholder engagement supports company’s due diligence, and states that, ‘in the context of Non-Financial Reporting, the company should effectively identify and engage with its stakeholders as part of the process of determining stakeholder materiality.’
Require that human rights risks and impacts should be assessed through dialogue with stakeholder or with their legitimate representatives.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity recommends aligning further with the UNGPs than the current draft legislation on the point of stakeholder dialogue.
The entity recommends that the EU co-legislators should, 'further look into aligning the proposal with the UN global framework (referencing the UNGPs), in particular with regard to ... meaningful stakeholder dialogue for companies to better identify their adverse impacts.'
Require that action plans are developed in consultation with affected stakeholders.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity agrees to some extent on question 6. The entity acknowledges the importance of managing and overseeing risks faced by stakeholders. However, it has not referred to legal duty of directors to identify the company’s stakeholder and their interests.
The entity agrees to some extent on question 6, stating that: ‘Transparency and governance in relation to business continuity and the sustainability of the business model could be enhanced. we would recommend that Boards, and in particular audit committees be required to actively oversee that management has established effective systems and controls relating to the viability of the company, the risk of fraud and other key risks faced by the company which may negatively impact its stakeholders.’
Require that corporate directors should manage the human rights risks for the company in relation to stakeholders and their interest including on the long run.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity agrees to some extent on question 6. The entity acknowledges the importance of managing and overseeing risks faced by stakeholders. However, it has not referred to the legal duty of directors to identify the company’s stakeholders and their interests.
The entity agrees to some extent on question 7. The entity acknowledges the role of assuming directors’ responsibility to sign off on public statements, assessment guidance on minimum non-exhaustive framework and aligning incentive and remuneration regarding identify risks and impacts on stakeholders. However, the Entity points out that this is a relatively new area of corporate governance and initial steps should be exploratory. It has not referred to the legal duty of directors to identify the company’s stakeholders and their interests.
| Legislation | Phase of Active Company Engagement | Position |
|---|
| Industry Association | Performance band |
|---|---|
| Assirevi | D+ |
| French Asset Management Association | D |
| Korea Business Association Europe | F |
| econsense | E- |
