Transposing the EU Corporate Sustainability Due Diligence Directive (CSDDD) into Binding Regulation

The Business and Human Rights Lawyers Association hosted this member-only event to discuss the challenges and opportunities faced by stakeholders during the transposition of CSDDD into binding regulations. Gabrielle Holly started by introducing the Transposition Guide recently released by the Danish Institute of Human Rights, which aims to ensure core due diligence concepts are transposed in ways that capture the intentions in the Directive, explore ambiguities in the language of the legislation, identify opportunities to push for ambitious requirement, and offer suggestions on the design of Supervisory Authorities and next steps for implementation.

With only two years for EU’s member states to complete the transposition process, Gabrielle expected most states to take a “de minimus approach,” but there are opportunities to ensure that transposition laws reflect the intentions of the CSDDD and align with the UNGPs. She identified several key challenges, including the potential departure from emerging UNGP-aligned practices, ambiguities in terminology, and translation issues that could lead to inconsistent interpretations. Responding to these potential obstacles, she stressed the importance of the states’ engagement with the European Commission during the transposition process, the design of strong supervisory authorities to oversee the implementation of the Directive, and the provision of adequate support for companies and stakeholders.

Inge van der Linden shared insights into the Netherlands’ approach to transposing the CSDDD, which involves publishing draft proposals for public consultation, engaging with stakeholders, and collaborating with supervisory authorities and other state ministries. She emphasized the need for each member state to align its regulations closely to the CSDDD to reduce ambiguities and enhance implementation consistency, as well as the importance of harmonization across EU member states to avoid fragmentation and ensure coherent supervision. She suggested utilizing the role of the Authority for Consumers and Markets (ACM) as a central supervisory body to prevent conflicts between sectors.

Adding to the conversation on public supervision, Martijn Scheltema stated that effective supervision requires an examination of real-world outcomes for stakeholders rather than merely checking formal compliance indicators such as corporate policies or training progress. He urged the EU as authorities to clarify ambiguities of the Directive and called for greater cooperation among member states to establish harmonized and effective supervisory practices. Martijn also highlighted barriers faced by smaller companies, particularly those in the Global South, in meeting the Directive’s requirements. To address these challenges, he recommended capacity-building measures and targeted support to improve access and compliance for these entities.

Speakers

‍Gabrielle Holly, Chief Adviser at Danish Institute for Human Rights, Copenhagen
Inge van der Linden, Senior Policy Officer at the Netherlands Ministry of Foreign Affairs
Meg Roggensack (moderator), Executive Officer at Business and Human Rights Lawyers Association, DC
Martijn Scheltema, Partner at Pels Rijcken, The Hague