CPME

In response to phase 3, CPME states: “Imposing sustainability due diligence should remain a voluntary act for SMEs…”“CPME notes that the European Commission is well aware of the difficulties that such an obligation would pose to SMEs…”

CPME does not reject the need for due diligence legislation in general, but expresses opposition to its mandatory nature for SMEs. Although the comment focuses on SMEs, which is more relevant to Q1.2, in this context the organization also appears to limit the ambition of the legislation by framing due diligence as applicable only in cases of actual harm, excluding potential impacts or forward-looking improvements. This narrows the thematic scope expected under Q1.1, which includes ongoing improvement of processes and broader risk management. The entity does not fully oppose the idea of due diligence legislation but suggests a lower level of ambition by emphasizing voluntary measures for certain company categories (SMEs) and excluding broader obligations such as improvements over time and the consideration of potential impacts. This weakens the scope and intent of a robust mandatory HRDD framework.

In response to phase 3, the entity discloses: “It would be unrealistic to subject small and medium-sized enterprises to these publication requirements, on a non-voluntary basis.” “The thresholds chosen… are unsuited to reality and do not allow fairness between businesses to be respected.”

CPME opposes the universal application of mandatory due diligence requirements to all companies, arguing that such obligations are disproportionate for SMEs. Furthermore, the organization criticizes the inclusion thresholds and highlights fairness concerns between different business sizes. Notably, CPME welcomes the lowering of the scope that has already taken place but still calls for additional limitations, reinforcing its position against broad and inclusive applicability. CPME clearly expresses opposition to requiring HRDD from all companies regardless of size, advocating for further exemptions for SMEs. By supporting the reduced scope already introduced and still pushing for further narrowing, the organization positions itself in clear opposition to the intention of indicator Q1.2, which calls for inclusive applicability across all company sizes.

In response to Phase 3, the entity states: CPME takes note of the European Commission’s approach of ensuring compliance with obligations through the introduction of penalties. CPME asks the European Commission to verify that the national transposition of the Directive contains sufficient sanctions to ensure that the Directive can achieve its ‘effet utile’ in accordance with the Treaty and the case law of the Court of Justice.” “It is also essential to put in place proportionate sanctions.” “However, this power of action left to the Member States is likely to create distortions…” “CPME stresses the importance of effectively regulating the financial sanctions framework...” “CPME calls for Article 24 to be deleted or, at the very least, for SMEs to be excluded…”

The CPME recognizes the importance of introducing sanctions to ensure compliance with the directive and calls on the European Commission to ensure that member states adopt effective measures. However, its position is strongly influenced by concerns about the proportionality of penalties and potential side effects for SMEs, such as retaliation within the value chain, competition distortions, and restrictions on access to state aid. The CPME also proposes that the article prohibiting access to public aid for penalized companies be either removed or made more flexible for SMEs. The CPME does not oppose the existence of enforcement mechanisms and acknowledges the importance of sanctions for the effectiveness of the directive, which prevents a negative score. However, there is no active or proactive support for strong enforcement mechanisms—on the contrary, there are several reservations and proposals for exemptions or leniency for SMEs. Thus, the overall position is neutral, with no outright opposition but also no effective support for the level of ambition proposed by indicator Q1.3.

The entity makes a reference to the topic in its Phase 3 response, stating: "...to be aware of the negative impacts of their activities on human and social rights, the environment, and climate change in corporate decision-making." Also, on pages 10 and 11, the entity concludes that: - considers it unrealistic to hold administrators accountable for transactions with entities to which the company has an indirect relationship.-It states that this measure would interfere with existing corporate governance models.-Advocates for the directors' duty of diligence to remain voluntary for SMEs.-Requests the complete removal of Article 25 from the Directive.

CPME clearly opposes the inclusion of specific legal obligations for directors regarding human rights impacts. The organization sees the proposal as a threat to existing governance, a source of fiduciary conflicts, and a risk of unfair liability, especially for SMEs. The explicit request for the exclusion of Article 25 demonstrates direct opposition to the core of the indicator. The reference to human rights impacts and the role of companies is vague and does not translate into clear support to formally including these duties in directors' legal obligations. The entity clearly and comprehensively rejects the inclusion of legal duties for directors related to human rights due diligence, even going as far as requesting the exclusion of the corresponding article from the legislative proposal.

In pages 6 and 7 of its response in phase 3, CPME: - Questions the terminology used in Article 9 (“complaint”), requesting its replacement with “report” to align with the Whistleblowing Directive.-Considers the proposed procedure to be more complex and burdensome than French legislation on the duty of vigilance.-Criticizes the departure from traditional social dialogue mechanisms, particularly in sectors like hospitality and food services.-Seeks to limit who can file a complaint, excluding representatives of non-unionized workers and restricting eligibility to direct victims, unions, and NGOs.-Views the provision as particularly detrimental to SMEs, suggesting they be excluded or that specific support measures be implemented

CPME expresses several objections to the proposed complaint mechanism as outlined in Article 9. The entity does not entirely reject the existence of a complaint mechanism but suggests significant modifications that would reduce its effectiveness and scope, such as: The exclusion of certain worker representatives. The limitation of eligible parties who can file complaints. The weakening of the transnational approach in favor of less stringent national models. The attempt to exclude SMEs from the scope.

These actions clearly indicate an effort to weaken the reach and power of the complaint mechanism, particularly in terms of including stakeholders from the value chain and diverse representatives. Although CPME does not outright oppose the existence of a complaint mechanism, it proposes multiple structural limitations that undermine its reach, accessibility, and effectiveness. These restrictions reduce the ambition of Article 9 and conflict with the principles established in indicator Q2.3.

In its response to Phase 3, page 10, CPME: CPME partially accepts the idea of civil liability (Article 22), praising the recognition of measures already adopted by companies as an assessment criterion. However, it requests that the civil liability regime not apply where special regimes already exist, such as work-related accidents covered by national legislation. It argues that special national rights should take precedence over the European directive.

CPME does not entirely reject the civil liability mechanism but proposes significant limitations on its application, particularly in contexts where national regimes already exist. By emphasizing the primacy of national law over the European directive, it seeks to restrict the full effectiveness of the European mechanism. The entity demonstrates a partially opposing stance by proposing exceptions to civil liability and attempting to limit the scope of the directive, even without completely rejecting it.

In its response to phase 3 on page 5 CPME directly criticizes the broad definition of "value chain," which includes both the supply chain (upstream) and the distribution chain (downstream), covering both direct and indirect partners.The organization states that this creates legal uncertainty, particularly for SMEs, and proposes limiting the scope of obligations only to immediate suppliers, excluding the distribution chain up to the final consumer. It argues that liability should only apply to direct contractual relationships, as beyond that "there is no legal evidence of involvement."

The CPME statement explicitly attempts to limit the scope of due diligence to only the direct supply chain (immediate suppliers), excluding the downstream part (distribution chain). This directly contradicts the definition of the value chain outlined in indicator Q3.1, which requires coverage both upstream and downstream. Furthermore, CPME challenges the concept of "indirect partners" and argues that obligations should not exist without a direct contract. This represents an effort to minimize corporate responsibility to the bare contractual minimum, weakening the proposed due diligence framework. The entity clearly and substantially opposes the implementation of a comprehensive due diligence process across the entire value chain. By proposing the exclusion of the distribution chain (downstream) and restricting the scope to direct contractual relationships, CPME significantly weakens the goal of Q3.1, which demands a robust, continuous, and fully inclusive value chain process.

In response to Phase 3,CPME acknowledges that the European Commission aims to restore fairness in contractual relationships by providing targeted support to SMEs. However, CPME argues that requiring business partners to comply with the company’s code of conduct places SMEs in an “uncertain situation of subordination.” CPME requests the removal of the paragraph that mandates adherence to clauses in well-established commercial relationships with business partners. It also questions the requirement for mandatory financial support from large companies to SMEs and calls for the removal of this obligation. Additionally, CPME advocates that the cost of verification should always be covered by independent third parties, rather than by the company (large or small).

CPME takes an ambivalent but generally critical stance on the requirement for contractual clauses and codes of conduct with business partners. While it acknowledges the Commission’s positive intent to support SMEs, it rejects key aspects of the contractual mechanism, including: The imposition of contractual obligations on partners, The mandatory alignment with codes of conduct, and The company’s responsibility for verification costs.

By requesting the removal of provisions that are central to indicator Q3.3, the entity significantly weakens the objective of contractual accountability within the value chain, one of the pillars of corporate due diligence. CPME does not entirely reject the use of contractual guarantees and support mechanisms but proposes fundamental changes that reduce the scope and effectiveness of the legal requirement. The proposal to exclude the obligation to align with codes of conduct, limit corporate accountability for larger companies, and revise or eliminate references to well-established business relationships are examples of efforts to soften the core requirements of indicator Q3.3

In the first paragrah, the entity states:"CPME takes note of the European Commission’s desire to encourage companies to take better account of the interests of their stakeholders (employees, suppliers, customers, etc.) and to be aware of the negative impacts of their activities on human and social rights, the environment and climate change in corporate decision-making." In the section Definitons, CPME challenges the definition of "stakeholders" presented in the Directive, arguing that it is too broad.The definition includes "not only the company's employees and its subsidiaries, but also 'other individuals, groups, communities, or entities.'" CPME asserts that these terms create legal uncertainty for companies and requests that they be either excluded or clearly specified. The entity does not propose expanding or detailing the mapping of vulnerable stakeholders but rather seeks to limit the scope of the concept.

Indicator Q4.1 requires companies to identify their stakeholders, including the most vulnerable, and understand their interests. This identification is essential for effective due diligence that is responsive to affected parties. CPME’s proposal moves in the opposite direction: the entity requests that the concept of stakeholders be narrowed, calling for the exclusion or restriction of broad terms such as “other individuals, groups, communities, or entities,” citing legal uncertainty. This stance reduces the scope and effectiveness of due diligence by making it harder to recognize relevant stakeholders, particularly those not formally linked to the company. CPME does not entirely reject the notion of stakeholders but proposes significant limitations that reduce the breadth and clarity of stakeholder identification—especially regarding vulnerable groups and impacted communities, which are central to Q4.1.

In response to phase 3, CPME criticizes the proposed definition of "stakeholders," arguing that it is too broad and introduces legal uncertainty.The definition includes not only the company’s employees and subsidiaries but also "other individuals, groups, communities, or entities," which, according to the entity, should either be excluded or more clearly specified. The entity does not propose strengthening the role of stakeholders in the risk management process but rather seeks to reduce its scope.

Indicator Q4.5 establishes that directors must manage human rights risks concerning stakeholders and their interests, including in the long term. This requires a comprehensive and inclusive understanding of who the stakeholders are and what risks affect them. CPME’s stance, by attempting to significantly limit the definition of stakeholders, goes against the ambition of the indicator. By seeking to exclude or restrict groups, communities, or entities that may be considered stakeholders, the organization reduces the ability of directors to effectively manage socio-environmental risks concerning these affected parties. CPME does not explicitly oppose risk management by directors but proposes substantial limitations that reduce the scope of this responsibility by restricting the definition of stakeholders. This compromises the full implementation of Q4.5, whose effectiveness depends on an inclusive and long-term approach in considering the interests of affected parties.