EU’s CSDDD hits a deadlock as the future of the directive remains unclear
The coming weeks will be critical for the European Union's Corporate Sustainability Due Diligence Directive (CSDDD) after it faced yet another setback this week. A vote scheduled for Wednesday once again fell through after the directive did not receive enough backing from EU member states, casting doubt on the law’s future.?
After two previous delays in the past month, the CSDDD was poised for a decisive vote on Wednesday, amidst ongoing negotiations among key EU member states.?
The proposed directive was set to be a key regulation, mandating that in-scope companies operating in the EU implement due diligence strategies to mitigate human rights violations and negative environmental impacts from their operations.?
While the directive was previously expected to be approved, recent opposition from key member states such as Germany and Italy put the approval at risk. On Wednesday, France also proposed last-minute changes which would greatly reduce the number of in-scope companies of the law.?
Directive’s approval not likely, but not impossible?
The Committee of Permanent Representatives (COREPER) has two more weeks to put forward a final text that secures sufficient backing from EU Member States and can be voted on by the European Parliament.?
The European Union is set to hold elections in June, if the Parliament cannot vote in time, the directive will be dropped with a chance for revival in the next legislative period. ?
We’re also watching...
US SEC set to vote on climate disclosure standards March 6?
The United States Securities and Exchange Commission (SEC) is expected to vote on a long-awaited climate disclosure rule on March 6.?
The proposed Climate Related Disclosure Standards (CRDS) would require companies to disclose their greenhouse gas emissions, climate-related risks and impacts. If adopted, the rule would be a landmark one for the US, as the country does not currently?impose common standards for climate-related disclosures.?
However, according to reports, the SEC made the disclosure standards optional and dropped requirements related to reporting Scope 3 emissions. Scope 3 emissions encompass the?indirect emissions?generated by a company's value chain, including both upstream and downstream activities. These emissions result from sources not owned or controlled by the company but are involved in operations, such as suppliers, clients/customers, and the use of sold products.?
While more difficult to track, Scope 3 emissions are crucial to understanding a company’s carbon footprint and reducing global GHG emissions.???
Want to know more about regulations? Download our new legislation guide.?
Our 2024 due diligence regulations guide is available now, giving you everything you need to know about the current regulatory landscape and how to adjust your responsible sourcing programme to comply.?
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This guide is for you if:?
Whether you're a seasoned sustainability professional or just beginning your journey towards responsible sourcing, this guide will equip you with the knowledge and tools needed to navigate the regulatory landscape with confidence and ensure your business is well-prepared to meet the demands of the evolving ESG ecosystem.? ?
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