Corporate Sustainability Due Diligence Directive (CSDDD) Overview
The Corporate Sustainability Due Diligence Directive (CSDDD) is a European Union directive aimed at protecting the environment and human rights globally. It places obligations on companies to address adverse impacts of their operations, subsidiaries, and supply chains. The directive requires companies to identify, prevent, mitigate, and account for these impacts, applying to large EU limited liability companies and non-EU companies active in the EU. The CSDDD aims to improve risk management, enhance customer trust, and provide better access to finance, but it also comes with increased compliance costs and competitive disadvantages.
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Presentation Transcript
+ The Corporate Sustainability Due Diligence Directive (CSDDD) + Alisa Kyyri inen, Liisa Saaranen
What is the CSDDD? A European Union directive for the protection of the environment and human rights around the globe It includes: + Setting obligations for companies to address the adverse impacts of their operations, subsidiaries, and supply chains Potential and actual impacts on the environment and human rights For a business to comply, they should indentify, prevent, mitigate, and account for these impacts. It applies to large EU limited liability companies, and non-EU companies that are active in the EU Large companies are also required to comply with the Paris Agreement
CSDDD benefits and problems? Benefits Problems Enhanced customer trust and employee commitment Increased compliance costs Competitive disadvantages Improved risk management Better access to finance
SignallingTheory Credibility Verifiability - Designated national supervisors to ensure proper enforcement and monitor the implementation of the rules, with heavy penalties - Corporate governance under negotiation - Enhances transparency - Gives stakeholders a holistic view of the sustainability performance of a company Understandability Imitability - Clear steps, processes, and requirements - Clear penalties - Hard to implement due to CSDDD's legal aspects, detailed requirements, and integration with broader EU sustainability goals
CSDDD vs CSRD + CSDDD (corporate sustainability due diligence directive) CSRD (Corporate sustainability reporting directive) - Focus is on due diligence - Companies should identify and address negative impacts - Pushes companies to create strategies regarding human rights and the environment - Anticipated to be adopted in 2024 - Focus is on reporting - Improve and broaden sustainability reporting for companies operating in the EU - Companies should disclose their sustainability impacts by following the EU s sustainability standards, which is heavily audited - First round of reporting in 2025
+ Thanks + Questions? CREDITS: CREDITS: This presentation template was created by Slidesgo Slidesgo, , and includes icons by Flaticon & images by Freepik Flaticon and infographics Freepik
