The EU Commission presented the draft for an EU-wide corporate responsibility law in Brussels today. It obliges corporations to respect human rights and the environment and - like the Corporate Responsibility Initiative (CRI) - contains liability rules and sanctions in the event of violations. The Federal Council must now keep its promise from the referendum campaign and ensure that Switzerland is not soon the only country in Europe without corporate responsibility. The media release of the Coalition for Corporate Responsibility in the original wording.
The Federal Council and the corporate lobby fought the Responsible Business Initiative mainly with the argument that the rules must be internationally coordinated. "If the Federal Council was really serious about this, it must act now and, like the EU, present a proper corporate responsibility law!" comments Dick Marty, board member of the Coalition for corporate responsibility. This is the only way Switzerland can ensure that it can enact a law at the same time as the EU and not soon be the only country in Europe without corporate responsibility.
Extensive liability rules and sanctions
The new EU directive applies to EU companies with 250 or more employees and contains a broad due diligence obligation for all human rights and international environmental standards. In addition, companies must demonstrate how they comply with the goals of the Paris Climate Agreement. Companies from third countries such as Switzerland that generate at least 150 million euros in turnover in the EU are also included.
In terms of enforcement, the regulation is designed to be more comprehensive than the corporate responsibility initiative: firstly, the EU member states must introduce supervisory authorities with the power to impose fines based on turnover. Secondly, in addition to the liability for subsidiaries demanded by the CDI, the EU proposal also includes liability for suppliers, and under certain conditions even for indirect suppliers.
The EU proposal therefore goes further than the Responsible Business Initiative and is not comparable with the token counter-proposal that came into force on January 1, 2022. The latter only provides for due diligence checks in two areas (child labor, conflict minerals) and completely dispenses with controls and sanctions.
Broad support from the business community
Clear voices from the business world had called for an effective EU directive and explicitly spoke out in favor of liability rules, including Nestlé, Danone, Epson, Ikea, Mondelez and Ferrero. "Clear rules and responsibilities as well as a level playing field are important for the economy. This is not achieved with the counter-proposal that has come into force. An improvement is therefore absolutely necessary," says Dietrich Pestalozzi, entrepreneur and board member.
Major campaign planned
The Coalition for Corporate Responsibility believes that the Federal Council and Parliament now have a responsibility. This is why the coalition will launch a major petition to the Federal Council in the summer to ensure that it swiftly presents an effective corporate responsibility law. Rahel Ruch, Executive Director of the Coalition, explains: "Together with the tens of thousands of supporters of the KVI campaign, we are determined to remind the Federal Council of its promises in no uncertain terms."
terre des hommes schweiz is a member of the Coalition for Corporate Responsibility. We are committed to the Responsible Business Initiative, which was adopted by a majority of the electorate on November 29, 2020. More info here
Logo: Committee for the Responsible Business Initiative
