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The EU’s Corporate Sustainability Due Diligence Directive is flawed. But it is an opportunity too


The Directive’s reduced scope will blunt its impact. But there will be much to learn from its implementation.

The EU Corporate Sustainability Due Diligence Directive looks finally set to become law, following the decision by the EU Council to approve the legislation on 15 March 2024.

Just a few weeks ago, its future hung in the balance. An unexpected move by Germany to abstain in a crucial Council vote, followed by Italy, led to the vote being pulled.

The publicly-stated reasons for these last-minute wobbles were concerns about increasing ‘red tape’ for businesses during challenging economic times. With the credibility of the EU’s responsible business agenda at stake, and with EU Parliamentary elections just around the corner, there was no time to lose in finding a compromise that might get the law over the line.

In the end, this was achieved largely through changes in timing and scope. The final negotiated version applies to companies with at least 1,000 employees and €450 million turnover. 

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