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 Company agrees that a due diligence legal requirement is needed, although it seems to have problems in relation to how little specific the actual wording around the proposal is.
The Company agrees (question 2) that an EU legal framework is needed although it is not clear up to what level it supports the DDD provided by the consultation. In its response to question 14 (whether agrees with definition) it indicates that 'we consider the proposed definition of "due diligence" duty too broad and lacking clarity on a number of terms: for instance it would be useful to have a commonly agreed definition of ... what constitute "reasonable efforts" or what is "foreseeable"'. Also, 'supply chains are complex, we should however find a solution that makes every company take on responsibility without overburdening them'. Finally, it is nvafor of a "minimum process and definitions approach" (question 15).
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 Company considersa that All SMEs should be excluded
Although the Company considers DDD should be applicable to all sectors it avocates that "All SMEs should be exlcuded", arguing that 'it is important for the obligations to be realistic and avoid creating existencial challenges for small companies. if SMEs were not exempted proper support from public authorities should be made available'.
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 Company is in favour national supervision with an EU coordination mechanism
In response to question 19a on enforcement mechanisms where companies fail to carry out DDD, the Company is in favour of "supervision by competent national authorities (option 2) with a mechanism of EU cooperation/coordination to ensure consistency ..."
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 Company disagrees 'to some extent' with a legal requirement for directors to establish procedures to ensure that possible risks and advese impacts on stakeholders are identified, prevented and addressed.
The Company disagrees in relation to a legal obligation for directors to manage stakeholders risks, as per questions 6 and 7. The Company argues that its directors 'already identify, analyse many of our stakeholders' intersts and manage risks' related to them. It also indicates that 'we are committed to managign risks and opportunities arising from stakeholders' interests, but we acknowledge this is a learning process, where all companies need the flexibilty to draw from their own experience of implementing such programmes'.
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 Company does not take position in relation to grievance mechanisms, it disagrees 'to some extent' with a requirement (for directors) to establish consultation channels for engaging with stakeholders on due diligence duty.
Question 20a asks about requirement for directors to establish mechanisms for engaging with stakeholders in this area (fulfilling its DDD more effectively) and the Company disagrees "to some extent". Although it does not directly inquiry about providing grievance mechanisms, the Company didn't respond to the question on complaint mechanisms being part of due diligence, and, when explaining stakeholder engagement, it responds that 'directors should be given flexibility as to how they engage with stakeholders'.
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 an 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.
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 Company advocates for a due diligence duty, covering the whole supply chain, using a, "minimum process and definitions approach". It doesn't refer to upstream.
The Company advocates for a due diligence duty, covering the whole supply chain, using a, "minimum process and definitions approach", although it considers that work needs to be done in relation to supply chain responsibility management without overburdening. There's no evidence on whether they consider this should include the upstream value chain. It is not asked by the consultation and the company does not refer to it.
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 question 6a asks about directors' duty, the company's response focuses on the task itself, not the person responsible, showing themselves to be potentially untrustworthy on future legislation.
The company considers to be, "relevant", all the stakeholder groups presented by the consultation in question 5. The company disagrees to some extent to question 6a regarding a director requirement of stakeholders' interests identification. It argues that '"stakeholders' interests" is an undefined concept and that it already identifies many of its stakeholders' interest, and manages their risks as per the German Corporate Governance Code, and that: 'the obligations that are envisaged, as stated in the phrasing of the question, are potentially far-reaching as they suggest a duty to manage an exhaustive list of stakeholders' interest, without giving consideration to the materiality of the risk or direct relevance of the said interests to 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.
When directly asked about the matter, the Company disagreed to some extent.
The Company's response to question 20a is, "I disagree to some extent". Then it clarifies that: 'it is in the interest of the Company's directors to have such engagement with stakeholders, directors should be given flexibility as to how they engage with stakeholders ... given this complexity on the ground, EU rules would risk being overly prescriptive and not have real added value in this area.' However, the question doesn't ask how they should be implemented, only if directors should be responsible for having mechanisms to do so.
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 company disagrees 'to some extent' with a legal requirement for directors to manage risks for the company in relation to stakeholders.
In its response to question 6, the Company disagrees, 'to some extent' for a legal requirement for directors to manage risks for the company in relation to stakeholders. It states that: ‘Zalando’s directors already identify, analyse many of our stakeholders’ interests and manage risks and opportunities related to them, as required by the Deutscher Corporate Governance Codex. … When it comes to human rights for instance, one commitment is that we will only work with partners who align with our ethical standards. In addition to agreeing to our Code of Conduct and Ethical Sourcing Standards, all brands selling on our platform will need to provide additional information on their social and environmental policies and standards as well as the implementation of these throughout their supply chains. … We would argue that it is in the company’s own best interest to have a broad overview of and manage our stakeholders’ interests. The obligations that are envisaged, as stated in the phrasing of the question, are potentially far-reaching as they suggest a duty to manage an exhaustive list of stakeholders’ interests, without giving consideration to the materiality of the risk or direct relevance of the said interests to the company. It may be that not all interests of stakeholders are fully compatible with each other, they may even be incompatible depending on the concrete situation, which is why it is essential to leave flexibility to the directors regarding the way to manage the company’s stakeholders’ interests.'
| Legislation | Phase of Active Company Engagement | Position |
|---|
| Industry Association | Performance band |
|---|---|
| Cascale | D- |
| Policy Hub Circularity for Apparel and Footwear | C+ |
