The European Parliament’s legal committee adopted a report on January 27 that urges the EU to make the protection of human rights and the environment in companies’ supply chains a legal requirement. The aim is to increase Europe’s scrutiny over the impact of companies’ operations beyond the 27-country bloc.
The report calls on the European Commission to suggest compulsory due diligence requirements on environmental and human rights risks for all companies and sectors within the EU, which should include state-owned undertakings and the financial sector.
EU lawmaker Lara Wolters, who drafted the report, explains that currently “there is no common European set of rules that holds companies liable for harm done to human rights and the environment in their supply chains.”
The report suggests introducing an EU law that requires companies to monitor, identify, prevent and remedy risks to human rights, the environment and governance in their operations and business relationships, which includes rights such as minimum age requirements and occupational safety.
To correctly implement this, company details should be made public when risks arise as well as the measures to solve the issue. National authorities would be responsible for checking whether companies are enforcing the rules, and would be given the right to apply punitive measures and investigate complaints. Victims of violations of EU due diligence law would have the right to take EU companies to court.
The vote on the proposal will take place in March for the full European Parliament.
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