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 doesn't consider that a legal framework on supply chain is needed and advocates for asking companies to follow existing guidelines and standards.
The entity responds to question 2 that a legal framework is not needed, 'it should be enough to focus on asking companies to follow existing guidelines and standards'. It states: ‘When it comes to addressing adverse impacts on human rights and environmental issues the EU is not starting from zero … The Non-Financial Reporting Directive already requires public interest companies to disclose information on the policies the implement in relation to … respect for human rights …. In 2017, the EU also adopted due diligence around conflict minerals … The Commission study on due diligence requirements through the supply chain from February 2020 shows that there are many initiatives across sectors and in different types of companies … Adopting a new legislative framework in this area raises many questions …. In addition, at a time where value chains are heavily disrupted due to the COVID19 crisis, introducing a new layer of legislation in the near future could make it harder for companies to effectively secure, redesign or be able to rebuild supply chains in the recovery phase’.
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 considers that micro-enterprises should be excluded and SMEs subject to lighter requirements an reporting requirements. It does not take an explicit position on sectors.
The Company selected multiple options in question 16, including the exclusion of micro-enterprises, SMEs being subject to lighter requirements and reporting requirements, on providing different types of suppor for SMEs. It does not take an explicit position on whether there should be an horizontal approach or only cover companies from specific sectors.
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 does not take position in relation to the different options presented by the consultation.
In response to question 19 it does not take a position in relation to the options proposed by the consultation and instead states that '‘The entity states that ‘The nature and scope of enforcement mechanisms and sanctions will depend on the exact content and scope of the regulation/obligation. When it comes to enforcement and sanctions, there is a critical difference between holding companies responsible for breaches in only the first tier of the supply chain or throughout the entire supply chain. Should the due diligence obligations apply throughout the entire supply chain, the sanctions should be determined differently for breaches in respectively first tier and beyond first tier’.
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 strongly disagrees with a legal requirement for directors to establish procedures to ensure risks and impacts on stakeholders are identified, prevented and addressed.
In its response to question 7 on whether directors should be legally required to establish procedures to ensure risks and impacts on stakeholders are identified, prevented and addressed, it states that '‘It is not up to the Board of Directors, which is not a permanent body, to set up procedures or targets to ensure that sustainability-related risks are identified, prevented, and addressed. It is a task for management which has to fulfill this duty by mapping risks and therefore allowing for the identification, assessment and prioritisation of sustainability-related risks. The role of the Board of Directors is to review these risks, as well the measures taken accordingly, based on the strategy it has defined. It should also be recalled that the Board’s duty is not only to address sustainability-related risks, but all kinds of risks’. It does not take position in relation to question 6 on whether directors should be legally required to manage risks in relation to stakeholders, indicating that ‘We ticked the box “I do not take position” as several of the suggestions are too wide and vague. … Directors’ duties cannot be put on a checklist formula as suggested by the previous two questions but through broad principles that provide flexibility for the company to identify in the present and in the long term which of the stakeholder interests it should consider in accordance with its activity, structure, nature and size. Moreover, it is not reasonable to believe that companies can carry out an exhaustive overview of all their stakeholders’ interests. … Regarding the management of the risks … in relation to stakeholders, we recall that the first mission of the Board is to determine the strategy of the company, taking into account the risks it is confronted …. Integrating and reporting on risks factors are key components of corporate stewardship and have already been included in EU legislation for a long time’.
Require companies to provide remedy for human rights impacts they have caused or contributed to.
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 does not refer explicitly to remedying human rights harms. Instead, it proposes a narrow liability framework, rejects vicarious liability for harms caused by business partners and supports a safe harbour approach. No reference is made to compensation or other forms of remedy, including in cases of contribution to harm.
In response to question 15 devotes a 'section' to describe its position on "accountability and remedy", where it states that '‘Any framework should be based on an obligation of means rather than the obligation of results. … Important to develop the legal notion of safe harbor. Companies should not be held liable for harm in their value chain when they have not directly caused it, could not reasonably be aware of it, or when they took the necessary measures to prevent it. Regulatory requirements should not lead inadvertently to situations where companies are held liable precisely because they took meaningful due diligence measures. There should be no vicarious liability whereby companies become responsible for the actions of other autonomous entities. When it comes to accountability it would be inappropriate to hold only European companies accountable for damages when it is impossible to control all the components of the chain and many other actors are involved. In order for a remedy to be used, there must be a direct link between the company and those affected’.
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.
Although the entity does not respond to the specific question regarding grievance mechanisms, it disagrees with a legal requirement to establish consultation channels for engaging with stakeholders as part of the due diligence duty.
It does not respond to question 20c on grievance mechanisms. However, it disagrees with question 20a on a requirement to establish consultation mechanisms. It states that ‘We recognise that consultation of relevant stakeholders is important in the life of companies, but it should be up to the company itself to define which stakeholders are relevant. Companies already organise the dialogue with their stakeholders using different mechanisms that are suitable to the intended goals'.
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 Company doesn't consider this a suitable option as enforcement mechanism.
Question 19a asks about enforcement mechanisms through a multiple-choice format, one of which is 'judicial enforcement with liability and compensation in case of harm caused by not fulfilling the due diligence obligations'. The company did not select this as one of its preferred measures. In addition, it does not mention liability in the explanation to its response.
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 does not consider that a legal framework on due diligence is needed and disagrees with several aspects of due diligence duty defintion.
The entity does not consider that a legal framework on due diligence is needed (question 2). In relation to question 14, on whether it agrees with due diligence duty definition, it states '‘The proposed definition is based on the very large concept of due diligence according to OECD Guiding Principles and UNGP which EU companies are committed to apply in their operations as part of their responsible business conduct. While this broad scope is appropriate for a soft law approach, it is much more problematic when it is transformed into hard law obligations coupled with civil liability. Considering the purpose of this consultation and its hard law perspective, we disagree with two aspects of the proposed definition …’. These are the due diligence duty definition and supply chain definition. In relation to this second concept, it considers that efforts should be limited to first-tier suppliers/subcontractors. It does not refer to remedy nor improvement over time’. It also does not select any of the proposed approaches to due diligence duty as presented in question 15'.
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.
Although the entity's official response to question 6 is that it does not take a position on whether directors should be required to identify stakeholders and their interests, it opposes in practice.
Although its response question 6 on whether directors should be legally required to manage risks in relation to stakeholders states that it does not take a position, it then provides the following explanation: ‘We ticked the box “I do not take position” as several of the suggestions are too wide and vague. … companies and their boards usually identify the most relevant stakeholders e.g. workers, consumers, investors, etc) and then prioritize their actions to prevent and, if needed, mitigate the risks. Directors’ duties cannot be put on a checklist formula as suggested by the previous two questions but through broad principles that provide flexibility for the company to identify in the present and in the long term which of the stakeholder interests it should consider in accordance with its activity, structure, nature and size. Moreover, it is not reasonable to believe that companies can carry out an exhaustive overview of all their stakeholders’ interests. … We strongly believe that any legal consequences attached to this notion would be highly problematic and hazardous for companies. Companies should decide and disclose which stakeholders they take into account when determining their strategy depending on their stakeholders, end markets, footprint/communities and social and environmental impact. … Once a company has determined (and disclosed) its stakeholders and its materiality framework, it should decide how and to which extent they need to be taken into account for determining its strategy (e.g. as far as shareholders are concerned, the company should interact with its shareholders and understand their strategic objectives and what they expect from the company).
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 disagrees with a legal requirement to establish consultation channels for engaging with stakeholders as part of the due diligence duty.
In response to question 20a of the consultation, the entity disagrees 'to some extent' adding the following explanation: ‘We recognise that consultation of relevant stakeholders is important in the life of companies, but it should be up to the company itself to define which stakeholders are relevant. Companies already organise the dialogue with their stakeholders using different mechanisms that are suitable to the intended goals …. Specifically on workers … there is no need for further EU legal requirements to ensure this. The EU directive on information on consultation is already sufficient. Also, new legal requirements risk destabilising or duplicating existing effective provisions. involvement/ consultation/ information to relevant stakeholders is important, but should be determined by the company, depending on its specificities. Legally mandated mechanisms could lead to either meaningless box-ticking exercises or to conflicting situations (between different stakeholders’ interests) that would reduce efficiency of decision-making processes in companies and harm their competitiveness. Also, if there are requirements throughout the entire supply chain, at which levels should a company make sure to have a consultation mechanism …’.
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.
Although the entity's official response to question 6 is that it does not take a position on whether directors should be required to manage risks for the company in relation to stakeholders' interests, it opposes to both directors' duties and task being compulsory
Although its response question 6 on whether directors should be legally required to manage risks in relation to stakeholders states that it does not take a position, it then provides the following explanation: ‘We ticked the box “I do not take position” as several of the suggestions are too wide and vague. … companies and their boards usually identify the most relevant stakeholders e.g. workers, consumers, investors, etc) and then prioritize their actions to prevent and, if needed, mitigate the risks. Directors’ duties cannot be put on a checklist formula as suggested by the previous two questions but through broad principles that provide flexibility for the company to identify in the present and in the long term which of the stakeholder interests it should consider in accordance with its activity, structure, nature and size. Moreover, it is not reasonable to believe that companies can carry out an exhaustive overview of all their stakeholders’ interests. … We strongly believe that any legal consequences attached to this notion would be highly problematic and hazardous for companies. Companies should decide and disclose which stakeholders they take into account when determining their strategy depending on their stakeholders, end markets, footprint/communities and social and environmental impact. … Once a company has determined (and disclosed) its stakeholders and its materiality framework, it should decide how and to which extent they need to be taken into account for determining its strategy (e.g. as far as shareholders are concerned, the company should interact with its shareholders and understand their strategic objectives and what they expect from the company).
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