Publication
Publication
In-scope companies will be required to establish and implement processes to identify and take action in relation to the adverse human rights and environmental impacts of their operations, as well as those in their value chains. The regime can apply outside the EU, both in terms of the companies it brings into scope, the diligence that needs to be undertaken worldwide, and the indirect effects the new rules will have as they are cascaded up and down value chains. In addition, in-scope companies must adopt and implement climate transition plans and set climate targets in line with the Paris Agreement. In case of infringements, companies may be held liable and face significant financial penalties.
Member States have until 26 July 2026 to transpose the Directive into national law. It will then apply on a phased basis to in-scope companies from 26 July 2027. In view of the new, far-reaching obligations and risks under the CSDDD and their interplay with reporting obligations under the CSRD, companies are well-advised to plan ahead.
To aid in your planning, our podcast series explores various aspects of the Corporate Sustainability Due Diligence Directive (CSDDD) in bite-sized episodes. We cover its scope and timing, application to the financial sector, penalties and enforcement, transition plans, due diligence requirements, and comparisons with the Corporate Sustainability Reporting Directive (CSRD), among other topics.
