OECD

In the last few years, there has been a significant momentum behind imposing mandatory obligations on multinational enterprises (MNEs) to respect human rights and the environment. In 2017, France became the first Member State of the European Union (EU) to adopt and implement legally binding obligations on MNEs with the Loi de Vigilance. Following France’s footsteps, Germany adopted a law, Lieferkettengesetz, in 2021. Other Member States also got mobilized to adopt such laws, now the proposals being in the pipeline (The Netherlands, Belgium, Austria). Consequently, the EU started to work on legally binding rules as well to create legal certainty and a level playing field between the Member States. As such, the work of the European Commission produced the Draft Corporate Sustainability Due Diligence Directive in 2021. Furthermore, in December 2022, the Council adopted its position on the Commission Proposal. However, the road to the Council’s position generated much discontent among the Member States, especially regarding the Council’s proposal to leave it up to the Member States to…