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  • Studio Paci

CSDD: Significant Progress and Endorsement by the JURI Committee


At the heart of the European Parliament, the Legal Affairs Committee (JURI) has recently cast a significant vote, marking a step forward in the direction of corporate sustainability.

With a majority of 20 votes in favor versus 4 against, the approval of the political agreement on the Corporate Sustainability Due Diligence Directive (CSDD) bears witness to a growing consensus on the importance of integrating rigorous sustainability practices within the European corporate fabric.

The CSDD, following an agreement reached among EU members on an optimized version, sets precise requirements for businesses, both within the community and internationally, having more than 1000 employees and a turnover exceeding 450 million euros.

Franchises with a turnover greater than 80 million euros, of which at least 22.5 million come from royalties, are also included in this directive.

The aim is to identify and mitigate social and environmental damage in supply chains, with a particular emphasis on combating forced labor and preventing deforestation.

Beyond the mere identification of risks, the CSDD requires companies to develop and implement ecological transition plans in line with the global goal of limiting the average temperature increase to 1.5°C.

These plans should outline specific climate goals for the companies, foreseeing timelines, key actions, and detailing the investments necessary for their achievement.

Next Steps and Future Implications 📈

The plenary approval in the European Parliament, scheduled for April 24, represents the next critical step for the CSDD, followed by the formal adoption by the European Council.

The last-minute changes to the directive's text foreshadow a likely rectification procedure that will require a new vote from both institutions by the end of 2024, ideally after the European elections in June.

This regulatory advancement highlights not only the EU's commitment to ethical and sustainable business management but also the importance of adopting a long-term strategic vision in international business affairs.

Through the CSDD, the European Union positions itself as a leader in promoting a business model that values people and the planet equally, charting a course towards a future where sustainability is at the core of business decisions.

This approach emphasizes a radical transformation in how companies operate globally, pushing towards greater transparency, accountability, and environmental commitment.

The CSDD not only reflects the aspirations for a greener and fairer economy but also sets a benchmark for corporate social responsibility, positively influencing the European and global business ecosystem.

The approval and implementation process of the CSDD marks a turning point in the dialogue between economy and sustainability, laying the groundwork for an inclusive and sustainable ecological transition.

Companies are called to reconsider their operational strategies in light of a more pronounced commitment to reducing environmental impact and promoting social well-being, aligning with global sustainable development goals.


What are the main requirements of the Corporate Sustainability Due Diligence Directive (CSDD) for companies?

The Corporate Sustainability Due Diligence Directive (CSDD) mandates that businesses, both within the EU and internationally, with over 1000 employees and an annual turnover exceeding 450 million euros, must implement due diligence practices to identify, prevent, and mitigate environmental and social risks in their supply chains.

This includes adopting measures against forced labor and deforestation, as well as developing plans for an ecological transition, in line with the goal of keeping the global temperature rise below 1.5°C.

How will the CSDD affect transparency and environmental commitment in companies?

The introduction of the CSDD aims to increase transparency in business operations, requiring companies to publicize their due diligence practices and ecological transition plans.

This should not only encourage companies to operate more sustainably but also strengthen their accountability to stakeholders and consumers, positively contributing to global sustainable development goals.

What procedural steps are anticipated for the implementation and approval of the CSDD?

Following the preliminary approval by the Legal Affairs Committee (JURI), the CSDD will move towards plenary approval in the European Parliament. Subsequently, formal adoption by the European Council will be necessary. Given the nature of the recent amendments to the text, a rectification procedure may be required, implying further votes from both institutions before the end of 2024, after the European elections.


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