### 25. undertakings should first try to address and solve a potential or actual risk in consultation with stakeholders. should this attempt be unsuccessful , and the company’s responsible disengagement becomes an option , the company should also consider the potential adverse impacts of that decision and take appropriate measures to address them. ### 25. undertakings should first try to address and solve a potential or actual risk in consultation with stakeholders. should this attempt be unsuccessful , and the company’s responsible disengagement becomes an option , the company should also consider the potential adverse impacts of that decision and take appropriate measures to address them in accordance with the oecd due diligence guidance.


### 25. undertakings should first try to address and solve a potential or actual risk in consultation with stakeholders. should this attempt be unsuccessful , and the company’s responsible disengagement becomes an option , the company should also consider the potential adverse impacts of that decision and take appropriate measures to address them. ### 25. undertakings should first try to address and solve a potential or actual risk in consultation with stakeholders. should this attempt be unsuccessful , a decision to disengage from a supplier or other business relationship could be a last resort. any decision to disengage should also consider the potential adverse impacts of that decision and take appropriate measures to address them.


### 27. the concept of stakeholder should be broadly interpreted and include all persons whose rights and interests may be affected by the decisions of the company , which includes , but is not limited to , workers , local communities , indigenous peoples , citizens’ associations and shareholders , and organisations whose statutory purpose is to ensure that human and social rights , environmental and good governance standards are respected , such as trade unions and civil society organisations. ### 27. the concept of stakeholder should be broadly interpreted and include all persons whose rights and interests may be affected by the decisions of the company , which includes , but is not limited to , workers , local communities , children , indigenous peoples , citizens’ associations and shareholders , and organisations whose statutory purpose is to ensure that human and social rights , environmental and good governance standards are respected , such as trade unions and civil society organisations.


### 27. the concept of stakeholder should be broadly interpreted and include all persons whose rights and interests may be affected by the decisions of the company , which includes , but is not limited to , workers , local communities , indigenous peoples , citizens’ associations and shareholders , and organisations whose statutory purpose is to ensure that human and social rights , environmental and good governance standards are respected , such as trade unions and civil society organisations. ### 27. the concept of stakeholder should be broadly interpreted and include all persons whose rights and interests may be affected by the decisions of the company , which includes , but is not limited to , workers , local communities , indigenous peoples , citizens’ associations and shareholders , and organisations whose statutory purpose is to ensure that human and social rights , climate , environmental and good governance standards are respected , such as trade unions and civil society organisations.


### 28. to avoid the risk of critical stakeholder voices remaining unheard or marginalised in the due diligence process , the directive grants stakeholders the right to safe and meaningful consultation as regards the company’s due diligence strategy , and ensure the appropriate involvement of trade unions. ### 28. to avoid the risk of critical stakeholder voices remaining unheard or marginalised in the due diligence process , the directive grants stakeholders the right to safe and meaningful consultation as regards the company’s due diligence strategy , and ensure the appropriate involvement of trade unions or workers’ representatives or workers themselves.


### 29. complaint procedures should ensure that the anonymity , safety , physical and legal integrity of whistle-blowers is protected , in line with directive (eu) 2019/1937 of the european parliament and of the council. ### 29. complaint procedures should ensure that the anonymity , safety and physical and legal integrity of all complainants is protected. in particular , those procedures need to protect whistle-blowers , in line with directive (eu) 2019/1937 of the european parliament and of the council and human right defenders.


### 30. this directive requires undertakings to make all necessary efforts to identify all their suppliers. in order to be fully effective , due diligence should not be limited to the first tier downstream and upstream in the supply chain but should encompass all suppliers and sub-contractors , particularly those that , during the due diligence process , might have been identified by the undertaking as posing major risks. this directive , however , recognises that not all undertakings have the same resources or capabilities to identify all their suppliers and therefore makes that obligation subject to the principles of reasonableness and proportionality , which in no case should be interpreted by undertakings as a pretext not to comply with their obligation to make all necessary efforts in that regard. ### 30. this directive requires undertakings to make all necessary efforts to identify all their suppliers. in order to be fully effective , due diligence should not be limited to the first tier downstream and upstream in the supply chain but should encompass all suppliers and sub-contractors , particularly those that , during the due diligence process , might have been identified by the undertaking as posing major risks. this directive , however , recognises that not all undertakings have the same resources or capabilities. consequently , adapted rules should be drawn up for small and medium-sized undertakings , which in no case should be interpreted by undertakings as a pretext not to comply with their obligation to make all necessary efforts in that regard.


### 31. for due diligence to be embedded in the culture and structure of a company , it is necessary that the members of the administrative , management and supervisory bodies of the company be responsible for the adoption and implementation of the due diligence strategy. the board of directors should have the appropriate knowledge , training and experience in due diligence matters. the directive requires that large companies have an advisory committee from whose expertise on due diligence matters the undertaking should benefit. this directive also requires that remuneration policies be brought in line with the objectives of this directive. ### 31. for due diligence to be embedded in the culture and structure of a company , it is necessary that the members of the administrative , management and supervisory bodies of the company be responsible for the adoption and implementation of the sustainability and due diligence strategies. the board of directors should have the appropriate knowledge , training and experience in due diligence matters. the directive requires that large companies have an advisory committee from whose expertise on due diligence matters the undertaking should benefit. this directive also requires that remuneration policies be brought in line with the objectives of this directive.


### 32. coordination of undertakings’ due diligence efforts at sectoral level could enhance the consistency and effectiveness of their due diligence strategies. to this end , this directive provides that member states could encourage the adoption of due diligence action plans at sectoral level. to avoid stakeholders’ views being ignored , the directive requires that stakeholders participate in the definition of these plans. ### 32. coordination of undertakings’ due diligence efforts at sectoral level could enhance the consistency and effectiveness of their due diligence strategies. to this end , this directive provides that the adoption of due diligence action plans at sectoral level could be encouraged. to avoid stakeholders’ views being ignored , the directive requires that stakeholders participate in the definition of these plans. the development of such collective measures should in no way absolve the undertaking of its individual responsibility to perform due diligence or prevent it from being held accountable for damage it causes or contributes to.


### 32. coordination of undertakings’ due diligence efforts at sectoral level could enhance the consistency and effectiveness of their due diligence strategies. to this end , this directive provides that member states could encourage the adoption of due diligence action plans at sectoral level. to avoid stakeholders’ views being ignored , the directive requires that stakeholders participate in the definition of these plans. ### 32. coordination of undertakings’ due diligence efforts and voluntary collaborative actions at sectoral or cross-sectoral level could enhance the consistency and effectiveness of their due diligence strategies. to this end , this directive provides that member states could encourage the adoption of due diligence action plans at sectoral level. to avoid stakeholders’ views being ignored , the directive requires that stakeholders participate in the definition of these plans.


### 33. in order to be effective , a due diligence framework should include grievance mechanisms at company or sector level and in order to ensure that such mechanisms are effective the participation of stakeholders should be ensured. . those mechanisms should allow stakeholders to raise concerns and should function as early-warning risk-awareness systems. grievance mechanisms should be entitled to make suggestions as to how risks should be addressed by the undertaking. they should also be entitled to propose an appropriate remedy when it is brought to their attention that the undertaking has caused or contributed to harm. ### 33. in order to be effective , a due diligence framework should include grievance mechanisms at company or sector level and in order to ensure that such mechanisms are effective the participation of stakeholders should be ensured. . those mechanisms should allow stakeholders to raise concerns and should function as early-warning risk-awareness systems. grievance mechanisms should be entitled to make suggestions as to how risks should be addressed by the undertaking. they should also be entitled to propose an appropriate remedy when it is brought to their attention that the undertaking has caused or contributed to harm. they should include a commitment to cooperate in good faith with relevant non-judicial grievance mechanisms such as national contact points for responsible business conduct.


### 36. the national authorities are encouraged to cooperate and share information with the oecd national contact points (ncp) available in their country. ### 36. the national authorities are encouraged to cooperate and share information with the oecd national contact points (ncp) and national human rights institutions available in their country.


### 39. member states should introduce further legislation to ensure that undertakings can be held liable for damage caused by undertakings under their control where they have , in the course of business , committed violations of internationally recognized human rights or international environmental standards. they should not be held liable however if they can prove that they took all due care to avoid the loss or damage , or that the damage would have occurred even if all due care had been taken. when introducing liability regimes , member states should consider adopting appropriate limitation periods and introducing the loser pays principle. ### 39. member states should use existing liability regimes or , if necessary , introduce further legislation to ensure that undertakings can be held liable for damage caused by undertakings under their control where they have , in the course of business , committed violations of internationally recognized human rights or international environmental standards. they should not be held liable however if they can prove that they took all due care to avoid the loss or damage , or that the damage would have occurred even if all due care had been taken. when introducing these liability regimes , member states should consider adopting appropriate limitation periods and introducing the loser pays principle.


### 40. in order to create clarity and certainty and consistency among the practices of undertakings , in particular small , medium-sized and micro-enterprises , this directive requires the commission to prepare guidelines in consultation with member states and the oecd and with the assistance of a number of specialised agencies. a number of guidelines on due diligence produced by international organisations already exist which could be used as a reference for the commission when developing guidelines under this directive specifically for eu companies. in addition to general guidelines which could guide smes in the application of due diligence in their operations , the commission should envisage producing sector-specific guidelines and provide a regularly updated list of country fact-sheets in order to help companies assess the risks of their business operations in a given area. those fact-sheets should indicate in particular which list of conventions and treaties among those listed in article 3 of the directive have been ratified by a given country. ### 40. in order to create clarity and certainty and consistency among the practices of undertakings , this directive requires the commission to prepare guidelines in consultation with member states and the oecd and with the assistance of a number of specialised agencies. a number of guidelines on due diligence produced by international organisations already exist which could be used as a reference for the commission when developing guidelines under this directive specifically for eu companies. the commission should envisage producing sector-specific guidelines and provide a regularly updated list of country fact-sheets in order to help companies assess the risks of their business operations in a given area. those fact-sheets should indicate in particular which list of conventions and treaties among those listed in article 3 of the directive have been ratified by a given country.


### 1. this directive is aimed at ensuring that undertakings operating in the internal market fulfil their duty to respect human rights , the environment and good governance and do not cause or contribute to risks to human rights , the environment and good governance in their activities and those of their business relationships. ### 1. this directive is aimed at ensuring that undertakings operating in the internal market fulfil their duty to respect human rights , the environment and good governance and do not cause or contribute to risks to human rights , including trade union and workers’ rights , the environment and good governance in their activities and prevent and mitigate adverse impacts directly linked to their operations , products or services by a business relationships.


### 2. undertakings shall communicate their due diligence strategy to their workers and business relationships and to one of the national competent authorities designated pursuant to article 14. ### 2. undertakings shall communicate their due diligence strategy to their workers and business relationships and , on request , to one of the national competent authorities designated pursuant to article 14.


### 3. member states shall establish a centralised platform and ensure that undertakings upload on that platform their due diligence strategies or the statement referred to in article 4. ### 3. member states shall ensure that undertakings upload on a national or european centralised platform their due diligence strategies or the statement referred to in article 4. such platform could be the single european access point mentioned by the commission in its recent capital markets union action plan (com/2020/590).


### 3. member states shall establish a centralised platform and ensure that undertakings upload on that platform their due diligence strategies or the statement referred to in article 4. ### 3. member states shall establish a centralised platform and ensure that undertakings upload on that platform their due diligence strategies or the statement , including its risk assessment referred to in article 4(3).


### this directive is without prejudice to the obligations imposed on certain undertakings by directive 2013/34/eu to include in their management report a non-financial statement including a description of the policies pursued by the undertaking in relation to , as a minimum , environmental , social and employee matters , respect for human rights , anti-corruption and bribery matters , and the due diligence processes implemented. ### this directive is without prejudice to the obligations imposed on certain undertakings by directive 2013/34/eu to include in their management report a non-financial statement including a description of the policies pursued by the undertaking in relation to , as a minimum , climate , environmental , social and employee matters , respect for human rights , anti-corruption and bribery matters , and the due diligence processes implemented.


### 1. undertakings shall evaluate the effectiveness and appropriateness of their due diligence strategy at least once a year , and review it accordingly when necessary. ### 1. undertakings shall evaluate the effectiveness and appropriateness of their due diligence strategy and the implementation thereof at least once a year , and review it accordingly if there is a change within their value chain or if new risks are identified by their early-warning risk-awareness system.


### 2. the evaluation and review of the due diligence strategy shall be carried out in consultation with stakeholders and the involvement of trade unions in the same manner as when establishing the due diligence strategy. ### 2. the evaluation and review of the due diligence strategy shall be carried out in consultation with and involvement with stakeholders and the involvement of trade unions in the same manner as when establishing the due diligence strategy.


### 1. undertakings shall establish a grievance mechanism , both as an early-warning risk-awareness and as a remediation system , allowing any stakeholder to voice concerns regarding the existence of a human rights , environmental or governance risks. member states shall ensure that undertakings are enabled to provide for such a mechanism through collaborative arrangements with other undertakings or organisations. ### 1. large undertakings shall establish a grievance mechanism , both as an early-warning risk-awareness and as a remediation system , allowing any stakeholder to voice concerns regarding the existence of a human rights , environmental or governance risks. member states shall ensure that large undertakings are enabled to provide for such a mechanism through collaborative arrangements with other undertakings or organisations. member states shall encourage small and medium-sized undertakings to join such collaborative arrangements.


### 2. grievance mechanisms shall be legitimate , accessible , predictable , safe , equitable , transparent , rights-compatible and adaptable as set out in the effectiveness criteria for non-judicial grievance mechanisms in principle 31 of the united nations guiding principles on business and human rights. they shall provide for anonymous complaints. ### 2. grievance mechanisms shall be legitimate , accessible , predictable , safe , equitable , transparent , rights-compatible and adaptable as set out in the effectiveness criteria for non-judicial grievance mechanisms in principle 31 of the united nations guiding principles on business and human rights and the united nations crc general comment no 16. they shall provide for anonymous complaints.


### 2. grievance mechanisms shall be legitimate , accessible , predictable , safe , equitable , transparent , rights-compatible and adaptable as set out in the effectiveness criteria for non-judicial grievance mechanisms in principle 31 of the united nations guiding principles on business and human rights. they shall provide for anonymous complaints. ### 2. grievance mechanisms shall be legitimate , accessible , predictable , safe , equitable , transparent , rights-compatible and adaptable as set out in the effectiveness criteria for non-judicial grievance mechanisms in principle 31 of the united nations guiding principles on business and human rights. they shall provide for anonymous and/or confidential complaints.


### 1. member states shall ensure that when an undertaking identifies , in particular through its grievance mechanism , that it has caused or contributed to harm , it provides for or cooperates with- remediation. ### 1. member states shall ensure that when an undertaking identifies , in particular through its grievance mechanism , that it has caused or contributed or is directly linked to harm , it provides for or cooperates with- remediation.


### 1. member states shall ensure that when an undertaking identifies , in particular through its grievance mechanism , that it has caused or contributed to harm , it provides for or cooperates with remediation. ### 1. member states shall ensure that when an undertaking identifies that it has caused or contributed to harm , it provides for or cooperates with remediation.


### 5. member states shall ensure that proposal of a remedy by an undertaking does not prevent affected stakeholders from bringing civil proceedings in accordance with national law. ### 5. member states shall ensure that proposal of a remedy by an undertaking does not prevent affected stakeholders from bringing judicial proceedings in accordance with the law. in particular:


### 5. member states shall ensure that proposal of a remedy by an undertaking does not prevent affected stakeholders from bringing civil proceedings in accordance with national law. ### 5. member states shall ensure that proposal of a remedy by an undertaking does not prevent affected stakeholders from bringing civil or criminal proceedings in accordance with national law.


### 2. member states shall ensure that their laws , regulations and administrative provisions on liability , at least towards the undertaking , apply to the members of the administrative , management and supervisory bodies of the undertakings , as regards breach of the duties referred to in paragraph 1. ### 2. member states shall ensure that their laws , regulations and administrative provisions on liability apply to the members of the administrative , management and supervisory bodies of the undertakings , as regards breach of the duties referred to in paragraph 1.


### 1. member states shall ensure that the governing body of the undertaking has the necessary qualifications , knowledge and expertise as regards due diligence. ### deleted


### 2. large undertakings shall set up an advisory committee tasked with advising the governing body of the undertakings on due diligence matters and propose measures to cease , monitor , disclose , address , prevent and mitigate risks. advisory committees shall include stakeholders and experts in their composition. ### 2. large undertakings shall set up an advisory committee tasked with advising the governing body of the undertakings on due diligence matters and propose measures to cease , monitor , disclose , address , prevent and mitigate risks. advisory committees shall include trade union and worker representatives , other stakeholders and experts in their composition.


### 2. large undertakings shall set up an advisory committee tasked with advising the governing body of the undertakings on due diligence matters and propose measures to cease , monitor , disclose , address , prevent and mitigate risks. advisory committees shall include stakeholders and experts in their composition. ### 2. large undertakings shall set up an advisory committee tasked with advising the governing body of the undertakings on due diligence matters and propose measures to cease , monitor , disclose , address , prevent and mitigate risks and impacts. advisory committees shall include stakeholders and experts in their composition.


### 1. member states may encourage the adoption by undertakings of sectoral due diligence action plans aimed at coordinating the due diligence strategies of undertakings within an economic sector. ### 1. member states may encourage the adoption by undertakings of sectoral due diligence action plans aimed at coordinating the due diligence strategies of undertakings within an economic sector.


### 2. member states shall ensure that stakeholders , particularly trade unions , have the right to participate in the definition of sectoral due diligence action plans. ### 2. member states shall ensure that stakeholders , particularly trade unions or workers' representative or workers themselves , have the right to participate in the definition of sectoral due diligence action plans.


### 1. member state competent authorities shall have the power to carry out investigations to ensure that undertakings comply with the obligations set out in this directive. competent authorities shall be authorised to carry out checks on undertakings and interviews with affected or potentially affected stakeholders or their representatives. ### 1. member state competent authorities shall have the power to impose implementing measures on undertakings and to carry out investigations to ensure that undertakings comply with the obligations set out in this directive. competent authorities shall be authorised to carry out checks on undertakings and interviews with affected or potentially affected stakeholders or their representatives.


### 1. member state competent authorities shall have the power to carry out investigations to ensure that undertakings comply with the obligations set out in this directive. competent authorities shall be authorised to carry out checks on undertakings and interviews with affected or potentially affected stakeholders or their representatives. ### 1. member state competent authorities shall have the power to impose enforcement measures on undertakings and carry out investigations , including on site , to ensure that undertakings comply with the obligations set out in this directive and in the national implementing provisions. competent authorities shall be authorised to carry out checks on undertakings and interviews with affected or potentially affected stakeholders or their representatives.


### 1. member state competent authorities shall have the power to carry out investigations to ensure that undertakings comply with the obligations set out in this directive. competent authorities shall be authorised to carry out checks on undertakings and interviews with affected or potentially affected stakeholders or their representatives. ### 1. member state competent authorities shall have the power to carry out investigations to ensure that undertakings comply with the obligations set out in this directive , including undertakings which have stated that they are not directly linked to any risks. competent authorities shall be authorised to carry out checks on undertakings and interviews with affected or potentially affected stakeholders or their representatives.


### 2. investigations referred to in paragraph 1 shall either be conducted by taking a risk-based approach or in the event a competent authority is in possession of relevant information , including on the basis of substantiated complaints provided by any third party. ### 2. investigations referred to in paragraph 1 shall either be conducted by taking a risk-based approach or in the event a competent authority is in possession of relevant information , including on the basis of substantiated concerns provided by any third party.


### 3. member states shall facilitate the submission by third parties of complaints referred to in paragraph 2 by measures such as complaint submission forms and ensuring that complaints remain anonymous upon the request of the complainant. member states shall ensure that that form can also be completed electronically. ### 3. member states shall facilitate the submission by third parties of concerns referred to in paragraph 2 by measures such as concern submission forms and ensuring that concerns remain anonymous upon the request of the complainant. member states shall ensure that that form can also be completed electronically.


### 5. if as a result of the actions taken pursuant to paragraph 1 , a competent authority identifies a failure to comply with this directive , it shall grant the undertaking concerned an appropriate period of time to take remedial action. ### 5. if as a result of the actions taken pursuant to paragraph 1 , a competent authority identifies a failure to comply with this directive , the undertaking concerned must take remedial action without delay or the member state shall immediately impose penalties.


### 7. member states shall provide for penalties in accordance with article 19 in for undertakings that do not take remedial action within the period of time granted. ### 7. member states shall provide for penalties in accordance with article 19 for undertakings that do not take remedial action.


### 8. member states shall ensure that the national competent authorities keep records of the checks referred to in paragraph 1 , indicating , in particular , their nature and result , as well as records of any notice of remedial action issued under paragraph 5. ### 8. member states shall ensure that the national competent authorities keep records of the checks referred to in paragraph 1 , indicating , in particular , their nature and result , as well as records of any notice of remedial action issued.


### 1. in order to create clarity and certainty for undertakings , in particular small , medium-sized and micro undertakings , as well as ensure consistency among their practices , the commission , in consultation with member states and the oecd , and with the assistance of the fundamental rights agency , the european environment agency and the european agency for small and medium enterprises , shall publish general non-binding guidelines for undertakings on how best to fulfil the due diligence obligations set out in this directive. those guidelines shall provide practical guidance on how proportionality may be applied to due diligence obligations depending on the size and sector of the undertaking. the guidelines shall be made available no later than 18 months after the date of entry into force of this directive. ### 1. in order to create clarity and certainty for undertakings , as well as ensure consistency among their practices , the commission , in consultation with member states and the oecd , and with the assistance of the fundamental rights agency , the european environment agency and the european agency for small and medium enterprises , shall publish general non-binding guidelines for undertakings on how best to fulfil the due diligence obligations set out in this directive. those guidelines shall provide practical guidance on how proportionality may be applied to due diligence obligations depending on the size and sector of the undertaking. the guidelines shall be made available no later than 18 months after the date of entry into force of this directive.


### 3. in preparing the non-binding guidelines referred to in paragraphs 1 and 2 above , due account shall be taken of the united nations guiding principles on business and human rights , the ilo tripartite declaration of principles concerning multinational enterprises and social policy , the oecd due diligence guidance for responsible business conduct , the oecd guidelines for multinational enterprises , the oecd guidance for responsible mineral supply chains , the oecd due diligence guidance for responsible supply chains in the garment and footwear sector , the oecd guidance for responsible business conduct for institutional investors , and the oecd-fao guidance for responsible agricultural supply chains. ### 3. in preparing the non-binding guidelines referred to in paragraphs 1 and 2 above , due account shall be taken of the united nations guiding principles on business and human rights , the ilo tripartite declaration of principles concerning multinational enterprises and social policy , the oecd due diligence guidance for responsible business conduct , the oecd guidelines for multinational enterprises , the oecd guidance for responsible mineral supply chains , the oecd due diligence guidance for responsible supply chains in the garment and footwear sector , the oecd guidance for responsible business conduct for institutional investors , and the oecd-fao guidance for responsible agricultural supply chains , the united national committee on the rights of the child general comment 16 on state obligations regarding the impact of the business sector on children’s rights and the unicef children’s rights and business principles.


### 3. in preparing the non-binding guidelines referred to in paragraphs 1 and 2 above , due account shall be taken of the united nations guiding principles on business and human rights , the ilo tripartite declaration of principles concerning multinational enterprises and social policy , the oecd due diligence guidance for responsible business conduct , the oecd guidelines for multinational enterprises , the oecd guidance for responsible mineral supply chains , the oecd due diligence guidance for responsible supply chains in the garment and footwear sector , the oecd guidance for responsible business conduct for institutional investors , and the oecd-fao guidance for responsible agricultural supply chains. ### 3. in preparing the non-binding guidelines referred to in paragraphs 1 and 2 above , due account shall be taken of the united nations guiding principles on business and human rights , the ilo tripartite declaration of principles concerning multinational enterprises and social policy , the oecd due diligence guidance for responsible business conduct , the oecd guidelines for multinational enterprises , the oecd guidance for responsible mineral supply chains , the oecd due diligence guidance for responsible supply chains in the garment and footwear sector , the oecd guidance for responsible business conduct for institutional investors , the oecd due diligence for responsible corporate lending and securities underwriting and the oecd-fao guidance for responsible agricultural supply chains.


### article 17 ### deleted


### 1. member states shall provide for penalties applicable to infringements of the national provisions adopted in accordance with this directive and shall take all the measures necessary to ensure that those penalties are enforced. the penalties provided for shall be effective , proportionate and dissuasive. ### 1. member states shall provide for administrative penalties applicable to infringements of the national provisions adopted in accordance with this directive and shall take all the measures necessary to ensure that those penalties are enforced. the penalties provided for shall be effective , proportionate and dissuasive.


### 2. member states shall ensure that a repeated infringement by an undertaking of the national provisions adopted in accordance with this directive constitutes a criminal offence , when committed intentionally or with serious negligence. member states shall take the necessary measures to ensure that these offences are punishable by effective , proportionate and dissuasive criminal penalties. ### 2. member states shall ensure that a repeated infringement by an undertaking of the national provisions adopted in accordance with this directive constitutes a criminal offence , when committed intentionally or with serious negligence. member states shall take the necessary measures to ensure that these offences are punishable by effective , proportionate and dissuasive criminal penalties.


### 2. member states shall ensure that a repeated infringement by an undertaking of the national provisions adopted in accordance with this directive constitutes a criminal offence , when committed intentionally or with serious negligence. member states shall take the necessary measures to ensure that these offences are punishable by effective , proportionate and dissuasive criminal penalties. ### 2. member states shall ensure that a serious infringement by an undertaking of the national provisions adopted in accordance with this directive constitutes a criminal offence , in particular when committed intentionally or with serious negligence. member states shall take the necessary measures to ensure that these offences are punishable by effective , proportionate and dissuasive criminal penalties.


### the fact that an undertaking has carried out due diligence in compliance with the requirements set out in this directive shall not absolve the undertaking of any civil liability which it may incur pursuant to national law. ### 1. the fact that an undertaking has carried out due diligence in compliance with the requirements set out in this directive shall not absolve the undertaking of any civil liability which it may incur pursuant to national law.


### e. whereas this alarming situation has prompted a debate as to how to make businesses more responsive to the adverse impacts they cause or contribute to; ### e. whereas this alarming situation has prompted a debate as to how to make businesses more responsive to the adverse impacts they cause , contribute to or are directly linked to;


### e. whereas this alarming situation has prompted a debate as to how to make businesses more responsive to the adverse impacts they cause or contribute to; ### e. whereas this alarming situation has prompted a debate as to how to make businesses more responsive to the adverse impacts they cause or contribute to or are directly linked to; ;


### 2. recalls that due diligence is primarily a preventative mechanism and that companies should be first and foremost required to identify risks or adverse impacts and adopt policies and measures to address them; highlights that if an undertaking causes or contributes to an adverse impact it should provide for a remedy; ### 2. recalls that due diligence is primarily a preventative mechanism and that companies should be first and foremost required to identify risks or adverse impacts and adopt policies and measures to address them; highlights that if an undertaking causes or contributes to an adverse impact it must provide for a remedy;


### 2. notes that globalisation has created interdependencies between societies , where any product results from complex transnational supply and value chains and where decisions taken by european firms impact on peoples’ ability to enjoy human rights and fundamental freedoms worldwide; ### 2. notes that globalisation has created interdependencies between societies , where any product results from complex transnational supply and value chains and where decisions taken by european firms and financial institutions authorised to operate in the union impact on peoples’ ability to enjoy human rights and fundamental freedoms worldwide;


### 3. regrets that many businesses’ decisions are primarily guided by lower costs and higher profits with inadequate consideration of adverse impacts on human rights and the environment down their global value chains , while severe human rights violations often occur at primary production level , in particular when sourcing raw material and manufacturing products; ### 3. regrets that many businesses’ and financial institutions’ decisions are primarily guided by lower costs and higher profits with inadequate consideration of adverse impacts on human rights and the environment down their global value chains , while severe human rights violations often occur at primary production level , in particular when sourcing raw material and manufacturing products;


### 3. calls on the commission to apply a human rights-based approach to the future legislation which shall be designed , implemented , monitored and evaluated respecting the core human rights principles of transparency and access to information , inclusion and non-discrimination with a special focus on the most vulnerable; ### 3. calls on the commission to apply a human rights-based approach to the future legislation which shall be designed , implemented , monitored and evaluated respecting the core human rights principles of transparency and access to information , inclusion and non-discrimination with a special focus on the most vulnerable , participation and accountability; stresses that it should be guided by the overarching principle of “do not harm” as it is important to avoid unintended effects and that the legislation should be subjected to a meaningful and inclusive consultation process on the ground with the relevant stakeholders; highlights that process should be carried out in close cooperation with the union delegations; stresses that the future legislation should be informed by a gender analysis and take into account the specific needs of women and girls;


### 4. considers that the scope of any future mandatory eu due diligence framework should be broad and cover all undertakings governed by the law of a member state or established in the territory of the union , including those providing financial products and services , regardless of their size or sector of activity and of whether they are publicly owned or controlled undertakings; ### 4. considers that the scope of any future mandatory eu due diligence framework should be broad and cover all undertakings governed by the law of a member state or established in the territory of the union , including those providing financial products and services , regardless of their size or sector of activity and of whether they are publicly owned or controlled undertakings; recalls that the framework should also include companies which are established outside the eu but are active on the internal market;


### 4. considers that the scope of any future mandatory eu due diligence framework should be broad and cover all undertakings governed by the law of a member state or established in the territory of the union , including those providing financial products and services , regardless of their size or sector of activity and of whether they are publicly owned or controlled undertakings; ### 4. considers that the scope of any future mandatory eu due diligence framework should be broad and cover all undertakings governed by the law of a member state , established in the territory of the union , or offering goods and services in the internal market , including those providing financial products and services , regardless of their size or sector of activity and of whether they are publicly owned or controlled undertakings;


### 4. stresses that all human rights should be covered by the future legislation; considers that emphasis should be placed on workers and trade union rights , women , children or indigenous people; stresses that full alignment with existing legal obligations and standards at european and international level should be sought; is of the opinion that the legislation should address all types of human rights abuses; ### 4. stresses that all human rights should be covered by the future legislation; considers that emphasis should be placed on workers and trade union rights and , in particular , the rights to freedom of association , to collective bargaining and to a living wage; notes that the rights of women and vulnerable groups such as children and indigenous people should also receive special attention; stresses that full alignment with existing legal obligations and standards at european and international level , such as un guiding principles on business and human rights , the oecd guidelines for multinational enterprises , oecd due diligence guidance for responsible business conduct , relevant sector-specific oecd due diligence guidance , and the ilo tri-partite declaration of principles concerning multinational enterprises and social policy , should be sought; is of the opinion that the legislation should include all types of human rights abuses and not only the most serious ones;


### 5. considers that small , medium-sized and micro-enterprises may need less extensive and formalised due diligence processes , and that a proportional approach could take into account , amongst other elements , the sector of activity , the size of the undertaking , the context of its operations , its business model , its position in value chains and the nature of its products and services; ### 5. considers that a proportional approach could take into account , amongst other elements , the sector of activity , the size of the undertaking , the context of its operations , its business model , its position in value chains and the nature of its products and services;


### 6. underlines that due diligence strategies should be aligned with the sustainable development goals and eu policy objectives in the field of human rights and the environment , including the european green deal , and eu international policy; ### 6. underlines that due diligence strategies should be aligned with the sustainable development goals and eu policy objectives in the field of human rights and the environment , including the european green deal , and eu international policy , especially the paris agreement on climate change and its goals to hold the increase in the global average temperature to well below 2°c above pre-industrial levels and pursue efforts to limit the temperature increase to 1 , 5°c above pre-industrial levels;


### 6. underlines that due diligence strategies should be aligned with the sustainable development goals and eu policy objectives in the field of human rights and the environment , including the european green deal , and eu international policy; ### 6. underlines that due diligence strategies should be aligned with the sustainable development goals and eu policy objectives in the field of human rights and the environment , including the european green deal , the paris agreement and eu international policy;


### 6. is of the opinion that the new legislation should apply to all sectors , to all types of enterprises , whether public or private , and of all size across the union; considers that the focus should be placed on the risks; ### 6. is of the opinion that the new legislation should apply to all sectors , to all types of enterprises , whether public or private and of all size across the union; considers that the focus should be on sectors that present heightened human rights risks , including mining , food and agriculture , oil and gas , textiles , garments , leather , and footwear; believes that such horizontal approach should be supplemented by more specific standards and guidance at sector level;


### 7. is of the opinion that the future legislation should establish mandatory and effective corporate due diligence processes covering companies’ activities and their business relationships , including their supply and subcontracting chains; ### 7. is of the opinion that the future legislation should establish mandatory and effective corporate due diligence processes covering companies’ activities and their business relationships , including their supply and subcontracting chains; stresses that it should ensure the full and active involvement in the due diligence processes of those affected such as the trade unions and worker’s representatives but also local communities in the developing countries; notes that those processes should be aligned with international , european and union guidelines and standards; stresses that the legislation should oblige companies to adopt a due diligence policy duly articulated in a plan with clear objectives , concrete actions , expected results and indicators to measure progress; is of the opinion that there should be a clear obligation for companies and investors to identify and assess actual and potential risks , act upon the findings in order to cease and prevent negative impacts , track the implementation and the results and communicate how impacts have been addressed; notes that the plan should be adequately resourced and have a strong and inclusive monitoring mechanism; considers that companies should equip themselves with human rights , environmental and anti-corruption experts in order to guide the design and implementation of the policy and the plan as well as other possible related decisions; stresses that this type of expertise should also be part of the company’s management structures; believes that support measures should be foreseen for certain companies if needed;


### 10. considers that , to enforce due diligence , member states should designate national authorities to share best practices as well as to supervise and impose sanctions , including criminal sanctions in severe cases; ### 10. considers that , to enforce due diligence , member states should designate national authorities to share best practices as well as to supervise and impose sanctions , including civil and criminal sanctions in severe cases;


### 10. stresses that access to effective remedy is crucial; considers that the legislation should oblige companies to have an effective grievance mechanism that should be transparent , accessible , predictable , safe , trustworthy and accountable; considers , in addition , that such mechanism should provide for effective judicial remedies to victims of human rights violations , environmental damage and corruption abuses , individually and through collective actions; believes that special protection should be provided to human rights defenders and its lawyers; ### 10. stresses that access to effective remedy is crucial; considers that the legislation should oblige companies to have an effective grievance mechanism that should be transparent , accessible , predictable , safe , trustworthy and accountable; notes that such mechanisms should be designed in consultation with workers and affected communities; considers , in addition , that they should provide for effective judicial remedies to victims of human rights violations , environmental damage and corruption abuses , individually and through collective actions; believes that special protection should be provided to human rights defenders and their lawyers; considers that other non-judicial remedies should also be provided for; believes , in that regard , that the legislation should consider the possibility of setting up a union grievance mechanism which could be managed by union delegations and whereby victims and populations affected by abuses committed by the union enterprises and their supply chains could file complaints; considers that that mechanism should be coordinated at a central level by the relevant union institutions , bodies , offices and agencies and adequately resourced;


### 11. considers that company-level grievance mechanisms can provide effective early-stage recourse , provided they are legitimate , accessible , predictable , equitable , transparent and human rights-compatible; ### 11. considers that company-level grievance mechanisms can provide effective early-stage recourse , provided they are legitimate , accessible , predictable , equitable , transparent , human rights-compatible and protect against retaliation; highlights that state-based non-judicial grievance mechanisms such as national contact points for responsible business conduct can also play a role in ensuring access to remedy;


### 11. is convinced that it is crucial to make the sustainable development chapters of free trade agreements more enforceable and that the new legislation should explore ways of integrating the due diligence requirements into those chapters. ### 11. is convinced that it is crucial to make the sustainable development chapters of free trade agreements binding and enforceable and that the new legislation should explore ways of integrating the due diligence requirements into those chapters; believes that this would also help to avoid distortion of competition with companies based outside europe; considers that economic partnership agreements that the union signed with acp countries could also be reinforced in a similar way;


### 12. further considers that in order to enable victims to obtain remedy , undertakings should be held liable for the damage the undertakings under their control have caused or contributed to where the latter have , in the course of their business relationships with the former , committed violations of internationally recognized human rights or have caused environmental harm; ### 12. further considers that undertakings should bear civil liability for damage incurred in the course of their own activities or through their business relationships if due diligence could have prevented that damage from occurring;


### 12. further considers that in order to enable victims to obtain remedy , undertakings should be held liable for the damage the undertakings under their control have caused or contributed to where the latter have , in the course of their business relationships with the former , committed violations of internationally recognized human rights or have caused environmental harm; ### 12. further considers that in order to enable victims to obtain remedy , undertakings should be held liable for the damage the undertakings under their control , which can be economic , have caused or contributed to where the latter have , in the course of their business relationships with the former , committed violations of internationally recognized human rights or have caused environmental harm;


### 13. urges the commission to propose union mandatory human rights and environmental due diligence legislation imposing legal obligations on union companies and companies domiciled or operating in the union internal market and establishing effective monitoring , enforcement and remedy mechanisms; ### 13. urges the commission to propose union mandatory human rights and environmental due diligence legislation imposing legal obligations on union companies and companies domiciled or operating in the union internal market , including all financial institutions authorised to operate in the union , and establishing effective monitoring , enforcement and remedy mechanisms;


### 14. considers that , in line with the un ‘protect , respect and remedy’ framework considerations on the rights of victims to a remedy , the jurisdiction of eu courts should be extended to business-related civil claims brought against eu undertakings on account of harm caused within their value chain on account of human rights violations; further considers necessary the introduction into eu law of a forum necessitatis to give access to a court to victims who risk being denied justice; ### 14. considers that , in line with the un ‘protect , respect and remedy’ framework considerations on the rights of victims to a remedy and the un guiding principles on business and human rights , the jurisdiction of eu courts should be extended to business-related civil claims brought against eu undertakings on account of harm caused within their value chain on account of human rights violations or environmental harm; further considers necessary the introduction into eu law of a forum necessitatis to give access to a court to victims who risk being denied justice;


### 14. recommends that due diligence as required by union legislation be extended to all potential or actual adverse impacts which the company has or may have caused , contributed to or with which it may be directly linked; this extends to , but is not limited to , abuses across the entire value chain , including the parent undertaking , all subsidiaries , direct and indirect suppliers and subcontractors or other business partners; ### 14. recommends that due diligence as required by union legislation be extended to all potential or actual adverse impacts which a company , or a financial institution , has or may have caused , contributed to or with which it may be directly linked; this extends to , but is not limited to , abuses across the entire value chain , including the parent undertaking , all subsidiaries , direct and indirect suppliers and subcontractors or other business partners;


### 15. stresses that victims of business-related adverse impacts are often not sufficiently protected by the law of the country where the harm has been caused; considers , in this regard , that victims of human rights abuses committed by eu undertakings should be allowed to choose the law of a legal system with high human rights standards , which could be that of the place where the defendant undertaking is domiciled; ### 15. stresses that victims of business-related adverse impacts are often not sufficiently protected by the law of the country where the harm has been caused; considers , in this regard , that victims or stakeholders impacted by human rights , environmental or governance-related harms committed by undertakings breaching eu legislations should be allowed to choose the law of a legal system with high human rights standards , which would either be that of the place where the damage occurred (lex loci damni) , that of the place in which the event giving rise to the damage occurred (lex loci delicti commissi) or that of the place where the defendant undertaking is domiciled or , lacking a domicile in the member state , where it operates.


### 15. stresses that victims of business-related adverse impacts are often not sufficiently protected by the law of the country where the harm has been caused; considers , in this regard , that victims of human rights abuses committed by eu undertakings should be allowed to choose the law of a legal system with high human rights standards , which could be that of the place where the defendant undertaking is domiciled; ### 15. stresses that victims of business-related adverse impacts are often not sufficiently protected by the law of the country where the harm has been caused; considers , in this regard , that victims of human rights abuses committed by undertakings operating in the eu should be allowed to choose the law of a legal system with high human rights standards , which could be that of the place where the defendant undertaking is domiciled;


### 15. recommends that union legislation cover all companies and all sectors , including state-owned enterprises , the banking sector and financial institutions , including the european investment bank; ### 15. recommends that union legislation cover all companies and all sectors , including state-owned enterprises , the banking sector and all financial institutions authorised to operate in the union , including the european investment bank;


### 16. requests that the commission submit without undue delay a legislative proposal on mandatory supply chain due diligence , following the recommendations set out in the annex hereto; considers that , without prejudice to detailed aspects of the future legislative proposal , articles 50 , 83(2) and 114 tfeu should be chosen as legal bases for the proposal; ### 16. requests that the commission submit without undue delay a legislative proposal on mandatory supply chain due diligence , following the recommendations set out in the annex hereto; considers that , without prejudice to detailed aspects of the future legislative proposal , articles 50 , 83(2) , 114 , 153(1)(e) and 191 tfeu should be chosen as legal bases for the proposal;


### having regard to the treaty on the functioning of the european union , and in particular articles 50 , 83(2) and 114 thereof , ### having regard to the treaty on the functioning of the european union , and in particular articles 50 , 83(2) , 114 , 153(1)(e) and 191 thereof ,


### 1. the debate on the responsibilities of business in relation to human rights became prominent in the 1990s , when new offshoring practices in clothing and footwear production drew attention to the poor labour conditions that many workers in global value chains faced. at the same time , many oil , gas , and mining companies pushed into increasingly remote areas , often displacing indigenous communities without adequate consultation or compensation. ### 1. the debate on the responsibilities of business in relation to human rights became prominent in the 1990s , when new offshoring practices in clothing and footwear production drew attention to the poor labour conditions that many workers in global value chains faced. at the same time , many oil , gas , mining and food industry companies pushed into increasingly remote areas , often displacing indigenous communities without adequate consultation or compensation.


### 3. this framework was followed by the un human rights council’s endorsement in 2011 of the “guiding principles on business and human rights” (ungps). the ungps introduced the first global standard for “due diligence” and enabled companies to put their responsibility to respect human rights into practice. subsequently , other international organisations developed due diligence standards based on the ungps. the 2011 oecd guidelines for multinational enterprises refer extensively to due diligence and the oecd has developed guidance to help enterprises carry out due diligence in specific sectors and supply chains. in 2018 , the oecd adopted general due diligence guidance for responsible business conduct. similarly , the international labour organisation (ilo) adopted in 2017 the ilo tripartite declaration of principles concerning multinational enterprises and social policy , which encourages enterprises to put in place due diligence mechanisms to identify , prevent , mitigate and account for the manner in which they address their business’s actual and potential adverse impacts as regards internationally recognized human rights. ### 3. this framework was followed by the un human rights council’s endorsement in 2011 of the “guiding principles on business and human rights” (ungps). the ungps introduced the first global standard for “due diligence” and enabled companies to put their responsibility to respect human rights into practice. subsequently , other international organisations developed due diligence standards based on the ungps. the 2011 oecd guidelines for multinational enterprises refer extensively to due diligence and the oecd has developed guidance to help enterprises carry out due diligence in specific sectors and supply chains. in 2018 , the oecd adopted general due diligence guidance for responsible business conduct. similarly , the international labour organisation (ilo) adopted in 2017 the ilo tripartite declaration of principles concerning multinational enterprises and social policy , which encourages enterprises to put in place due diligence mechanisms to identify , prevent , mitigate and account for the manner in which they address their business’s actual and potential adverse impacts as regards internationally recognized human rights. the 2012 united nations global compact , save the children and unicef children’s rights and business principles identify key children’s rights considerations relating to adverse business impact and unicef has developed a series of guidance documents supporting business due diligence and children. the 2013 un committee on the rights of the child general comment no. 16 identifies a comprehensive range of state obligations regarding the impact of the business sector on children’s rights , including states requiring businesses to undertake child-rights due diligence.


### to this end , it establishes minimum requirements for undertakings to identify , prevent , cease , mitigate , monitor , disclose , account , address and remediate the human rights , environmental and governance risks that those activities may pose. by coordinating safeguards for the protection of human rights , the environment and good governance , those due diligence requirements are aimed at improving the functioning of the internal market. ### this directive lays down the value chain due diligence obligations of undertakings , namely to identify , prevent , cease , mitigate , monitor , disclose , account , address and remediate the human rights , environmental and governance risks that their activities may pose. by coordinating safeguards for the protection of human rights , the environment and good governance , those due diligence requirements are aimed at improving the functioning of the internal market.


### 2. this directive further aims to ensure that undertakings can be held accountable for their adverse human rights , environmental and governance impacts throughout their value chain. ### 2. this directive further aims to ensure that undertakings can be held accountable and liable for the adverse human rights , environmental and governance impacts they cause , contribute or are directly linked to throughout their value chain.


### 2. this directive further aims to ensure that undertakings can be held accountable for their adverse human rights , environmental and governance impacts throughout their value chain. ### 2. this directive further aims to ensure that undertakings can be held accountable for their adverse human rights , environmental and governance impacts throughout their value chain , insofar as they have caused or contributed to these impacts or have a direct connection to them. it also aims to ensure that victims have access to legal remedies.


### 2. this directive further aims to ensure that undertakings can be held accountable for their adverse human rights , environmental and governance impacts throughout their value chain. ### 2. this directive further aims to ensure that undertakings can be held accountable for their adverse human rights , environmental and governance impacts that hey cause or contribute to throughout their value chain and aims to ensure victims’ access to remedy for harm.


### 3. this directive shall apply without prejudice to further due diligence requirements established in union sector-specific legislation , in particular regulation (eu) no 995/20108 and regulation (eu) 2017/8219 . ### 3. this directive shall apply without prejudice to further due diligence requirements established in union sector-specific legislation , in particular regulation (eu) no 995/20108 and regulation (eu) 2017/8219 and other future sector-specific legislation that may be developed.


### in case of insurmountable incompatibility , the sector-specific legislation shall apply. ### deleted


### in case of insurmountable incompatibility , the sector-specific legislation shall apply. ### in case of insurmountable incompatibility , the legislation that provides the highest standards of protection with regards to human rights , the environment and governance shall apply.


### 5. the implementation of this directive shall in no way constitute grounds for justifying a reduction in the general level of protection of human rights or the environment. in particular , it shall be applied without prejudice to other existing subcontracting , posting or chain liability frameworks. ### 5. the implementation of this directive shall in no way constitute grounds for justifying a reduction in the general level of protection of human rights or the environment. in particular , it shall be applied without prejudice to other subcontracting , posting or chain liability frameworks established at national , european and international level..


### 1. this directive shall apply to all undertakings governed by the law of a member state or established in the territory of the union. ### 1. this directive shall apply to all undertakings governed by the law of a member state or established in the territory of the union , as defined in article 3(4) of the accounting directive.


### 2. it shall also apply to limited liability undertakings governed by the law of a non-member state and not established in the territory of the union when they operate in the internal market selling goods or providing services. an undertaking governed by the law of a non-member state and not established in the territory of the union shall be considered in compliance with this directive if it fulfils the due diligence requirements established in this directive as transposed in the legislation of the member state in which it operates. ### 2. it shall also apply to large limited liability undertakings governed by the law of a non-member state and not established in the territory of the union when they operate in the internal market selling goods or providing services. a large undertaking governed by the law of a non-member state and not established in the territory of the union shall be considered in compliance with this directive if it fulfils the due diligence requirements established in this directive as transposed in the legislation of the member state in which it operates.


### 2. it shall also apply to limited liability undertakings governed by the law of a non-member state and not established in the territory of the union when they operate in the internal market selling goods or providing services. an undertaking governed by the law of a non-member state and not established in the territory of the union shall be considered in compliance with this directive if it fulfils the due diligence requirements established in this directive as transposed in the legislation of the member state in which it operates. ### 2. it shall also apply to undertakings governed by the law of a non-member state and not established in the territory of the union when they operate in the internal market selling goods or providing services. an undertaking governed by the law of a non-member state and not established in the territory of the union shall be considered in compliance with this directive if it fulfils the due diligence requirements established in this directive as transposed in the legislation of the member state in which it operates.


### 3. member states may exempt micro-undertakings as defined in directive 2013/34/eu from the application of the obligations set up in this directive. ### deleted


### 3. member states may exempt micro-undertakings as defined in directive 2013/34/eu from the application of the obligations set up in this directive. ### 3. member states may adapt the requirements of this directive to the specific circumstances of micro-undertakings as defined in directive 2013/34/eu.


### - 'due diligence' means the process put in place by an undertaking aimed at identifying , ceasing , preventing , mitigating , monitoring , disclosing , accounting for , addressing , and remediating the risks posed to human rights , including social and labour rights , the environment , including through climate change , and to governance , both by its own operations and by those of its business relationships. ### - “due diligence obligation” means the obligation for an undertaking to take all reasonable measures to prevent human rights and environmental adverse impacts from occurring down their value chains , and to properly address such adverse impacts when they occur. the exercise of a due diligence obligation means identifying , assessing , preventing , ceasing , mitigating , monitoring , tracking , communicating , disclosing , accounting for , addressing , and remediating the potential and actual adverse impacts on human rights , including social and labour rights , the environment , including the contribution to climate change , and governance , in their own operations , their value chain and other business relationships.


### - 'due diligence' means the process put in place by an undertaking aimed at identifying , ceasing , preventing , mitigating , monitoring , disclosing , accounting for , addressing , and remediating the risks posed to human rights , including social and labour rights , the environment , including through climate change , and to governance , both by its own operations and by those of its business relationships. ### - 'due diligence' means the process put in place by an undertaking aimed at identifying , ceasing , preventing , mitigating , monitoring , disclosing , accounting for , addressing , and remediating the risks posed to human rights , including social , trade union and labour rights , the environment , including through climate change , and to governance , both by its own operations and by those of its business relationships.


### - 'due diligence' means the process put in place by an undertaking aimed at identifying , ceasing , preventing , mitigating , monitoring , disclosing , accounting for , addressing , and remediating the risks posed to human rights , including social and labour rights , the environment , including through climate change , and to governance , both by its own operations and by those of its business relationships. ### - 'due diligence' means the process put in place by an undertaking aimed at identifying , ceasing , preventing , mitigating , monitoring , disclosing , accounting for , addressing , and remediating the risks posed to human rights , including social and labour rights , the environment , including through climate change , and to good governance , both by its own operations and by those of its business relationships.


### - ‘stakeholders’ means individuals and groups of individuals whose rights or interests may be affected by the human rights , environmental and good governance risks posed by an undertaking or its business relationships , as well as organisations whose statutory purpose is the defence of human rights , including social and labour rights , the environment and good governance , and includes but is not limited to workers and their representatives , local communities , indigenous peoples , citizens’ associations , trade unions , civil society organisations and the undertakings’ shareholders. ### - ‘stakeholders’ means individuals and groups of individuals whose rights or interests may be affected by the human rights , environmental and good governance risks posed by an undertaking or its business relationships , as well as organisations whose statutory purpose is the defence of human rights , including social and labour rights , the environment and good governance , and includes but is not limited to workers and their representatives , local communities , children , indigenous peoples , citizens’ associations , trade unions , civil society organisations and the undertakings’ shareholders.


### - ‘human rights risk’ means any potential or actual adverse impact that may impair the full enjoyment of human rights by individuals or groups of individuals in relation to internationally recognized human rights , understood , at a minimum , as those expressed in the international bill of human rights , the united nations human rights instruments on the rights of persons belonging to particularly vulnerable groups or communities , and the principles concerning fundamental rights set out in the ilo declaration on fundamental principles and rights at work , as well as those recognised in the ilo convention on freedom of association and the effective recognition of the right to collective bargaining , the ilo convention on the elimination of all forms of forced or compulsory labour , the ilo convention on the effective abolition of child labour , and the ilo convention on the elimination of discrimination in respect of employment and occupation. they further include , but are not restricted to , adverse impacts in relation to other rights recognised in a number of ilo conventions , such as freedom of association , minimum age , occupational safety and health , and equal remuneration , and the rights recognised in the convention on the rights of the child , the african charter of human and peoples’ rights , the american convention on human rights , the european convention on human rights , the european social charter , the charter of fundamental rights of the european union , and national constitutions and laws recognising or implementing human rights. ### - ‘human rights risk’ means any potential or actual adverse impact that may impair the full enjoyment of human rights by individuals or groups of individuals in relation to internationally recognized human rights.


### - ‘human rights risk’ means any potential or actual adverse impact that may impair the full enjoyment of human rights by individuals or groups of individuals in relation to internationally recognized human rights , understood , at a minimum , as those expressed in the international bill of human rights , the united nations human rights instruments on the rights of persons belonging to particularly vulnerable groups or communities , and the principles concerning fundamental rights set out in the ilo declaration on fundamental principles and rights at work , as well as those recognised in the ilo convention on freedom of association and the effective recognition of the right to collective bargaining , the ilo convention on the elimination of all forms of forced or compulsory labour , the ilo convention on the effective abolition of child labour , and the ilo convention on the elimination of discrimination in respect of employment and occupation. they further include , but are not restricted to , adverse impacts in relation to other rights recognised in a number of ilo conventions , such as freedom of association , minimum age , occupational safety and health , and equal remuneration , and the rights recognised in the convention on the rights of the child , the african charter of human and peoples’ rights , the american convention on human rights , the european convention on human rights , the european social charter , the charter of fundamental rights of the european union , and national constitutions and laws recognising or implementing human rights. ### - ‘human rights risk’ means any potential or actual adverse impact that may impair the full enjoyment of human rights by individuals or groups of individuals in relation to internationally recognized human rights , understood , at a minimum , as those expressed in the international bill of human rights , customary international law and human rights instruments on the rights of persons belonging to particularly vulnerable groups or communities (including the international convention on the elimination of all forms of racial discrimination , the convention on the elimination of all forms of discrimination against women , the convention on the rights of the child , the international convention on the protection of the rights of all migrant workers and members of their families , the convention on the rights of persons with disabilities , the united nations declaration on the rights of indigenous peoples and the declaration on the rights of persons belonging to national or ethnic , religious and linguistic minorities) , and adverse impacts concerning other rights recognised in the tripartite declaration of principles concerning multinational enterprises and social policy (mne declaration) , the principles concerning fundamental rights set out in the ilo declaration on fundamental principles and rights at work , as well as those recognised in the ilo convention on freedom of association and the effective recognition of the right to collective bargaining , and the principles concerning fundamental rights set out in the ilo declaration on fundamental principles and rights at work , as well as those recognised in the ilo convention on freedom of association and the effective recognition of the right to collective bargaining , the ilo convention on the elimination of all forms of forced or compulsory labour , the ilo convention on the effective abolition of child labour , and the ilo convention on the elimination of discrimination in respect of employment and occupation. they further include , but are not restricted to , adverse impacts in relation to other rights recognised in a number of ilo conventions , such as freedom of association , minimum age , occupational safety and health , and equal remuneration , and the rights recognised in the convention on the rights of the child , the african charter of human and peoples’ rights , the american convention on human rights , the european convention on human rights , the european social charter , the charter of fundamental rights of the european union , and national constitutions and laws recognising or implementing human rights.


### - ‘human rights risk’ means any potential or actual adverse impact that may impair the full enjoyment of human rights by individuals or groups of individuals in relation to internationally recognized human rights , understood , at a minimum , as those expressed in the international bill of human rights , the united nations human rights instruments on the rights of persons belonging to particularly vulnerable groups or communities , and the principles concerning fundamental rights set out in the ilo declaration on fundamental principles and rights at work , as well as those recognised in the ilo convention on freedom of association and the effective recognition of the right to collective bargaining , the ilo convention on the elimination of all forms of forced or compulsory labour , the ilo convention on the effective abolition of child labour , and the ilo convention on the elimination of discrimination in respect of employment and occupation. they further include , but are not restricted to , adverse impacts in relation to other rights recognised in a number of ilo conventions , such as freedom of association , minimum age , occupational safety and health , and equal remuneration , and the rights recognised in the convention on the rights of the child , the african charter of human and peoples’ rights , the american convention on human rights , the european convention on human rights , the european social charter , the charter of fundamental rights of the european union , and national constitutions and laws recognising or implementing human rights. ### - ‘human rights risk’ means any potential or actual adverse impact that may impair the full enjoyment of human rights by individuals or groups of individuals in relation to internationally recognized human rights , understood , at a minimum , as those expressed in the international bill of human rights , the united nations human rights instruments on the rights of persons belonging to particularly vulnerable groups or communities , and the principles concerning fundamental rights set out in the ilo declaration on fundamental principles and rights at work , as well as those recognised in the ilo convention on freedom of association and the effective recognition of the right to collective bargaining , the ilo convention on the elimination of all forms of forced or compulsory labour , the ilo convention on the effective abolition of child labour , and the ilo convention on the elimination of discrimination in respect of employment and occupation. they further include , but are not restricted to , adverse impacts in relation to other rights recognised in the tripartite of principles concerning multinational enterprises and social policy (mne declaration) and a number of ilo conventions , such as freedom of association , collective bargaining , minimum age , occupational safety and health , and equal remuneration , and the rights recognised in the convention on the rights of the child , the african charter of human and peoples’ rights , the american convention on human rights , the european convention on human rights , the european social charter , the charter of fundamental rights of the european union , and national constitutions and laws recognising or implementing human rights.


### - ‘human rights risk’ means any potential or actual adverse impact that may impair the full enjoyment of human rights by individuals or groups of individuals in relation to internationally recognized human rights , understood , at a minimum , as those expressed in the international bill of human rights , the united nations human rights instruments on the rights of persons belonging to particularly vulnerable groups or communities , and the principles concerning fundamental rights set out in the ilo declaration on fundamental principles and rights at work , as well as those recognised in the ilo convention on freedom of association and the effective recognition of the right to collective bargaining , the ilo convention on the elimination of all forms of forced or compulsory labour , the ilo convention on the effective abolition of child labour , and the ilo convention on the elimination of discrimination in respect of employment and occupation. they further include , but are not restricted to , adverse impacts in relation to other rights recognised in a number of ilo conventions , such as freedom of association , minimum age , occupational safety and health , and equal remuneration , and the rights recognised in the convention on the rights of the child , the african charter of human and peoples’ rights , the american convention on human rights , the european convention on human rights , the european social charter , the charter of fundamental rights of the european union , and national constitutions and laws recognising or implementing human rights. ### - ‘human rights impact’ means any adverse impact that may impair the full enjoyment of human rights by individuals or groups of individuals in relation to internationally recognized human rights , understood , at a minimum , as those expressed in the international human rights conventions that are binding upon the european union or its member states , the international bill of human rights , international humanitarian law , the united nations human rights instruments on the rights of persons belonging to particularly vulnerable groups or communities , and the principles concerning fundamental rights set out in the ilo declaration on fundamental principles and rights at work , as well as those recognised in the ilo convention on freedom of association and the effective recognition of the right to collective bargaining , the ilo convention on the elimination of all forms of forced or compulsory labour , the ilo convention on the effective abolition of child labour , and the ilo convention on the elimination of discrimination in respect of employment and occupation. they further include , but are not restricted to , adverse impacts in relation to other rights recognised in a number of ilo conventions , such as freedom of association , minimum age , occupational safety and health , and equal remuneration , and the rights recognised in the convention on the rights of the child , the african charter of human and peoples’ rights , the american convention on human rights , the european convention on human rights , the european social charter , the charter of fundamental rights of the european union , and national constitutions and laws recognising or implementing human rights.


### - ‘environmental risk’ means any potential or actual adverse impact that may impair the right to a healthy environment , whether temporarily or permanently , and of whatever magnitude , duration or frequency. these include , but are not limited to , adverse impacts on the climate , the sustainable use of natural resources , and biodiversity and ecosystems. these risks include climate change , air and water pollution , deforestation , loss in biodiversity , and greenhouse emissions. ### - ‘environmental impact’ means any violation of internationally recognized environmental standards , any adverse impact on the environment , regardless of whether this adverse impact has directly affected humans or human rights. environmental impacts that may impair the right to a healthy environment , whether temporarily or permanently , and of whatever magnitude , duration or frequency shall be considered as particularly serious. these include , but are not limited to , adverse impacts on the climate , the sustainable use of natural resources , and biodiversity and ecosystems. these risks include climate change , air and water pollution , deforestation , loss in biodiversity , and greenhouse emissions.


### - ‘environmental risk’ means any potential or actual adverse impact that may impair the right to a healthy environment , whether temporarily or permanently , and of whatever magnitude , duration or frequency. these include , but are not limited to , adverse impacts on the climate , the sustainable use of natural resources , and biodiversity and ecosystems. these risks include climate change , air and water pollution , deforestation , loss in biodiversity , and greenhouse emissions. ### - ‘environmental risk’ means any potential or actual adverse impact that may impair the right to a healthy environment , whether temporarily or permanently , and of whatever magnitude , duration or frequency. these include , but are not limited to , adverse impacts on the climate caused by greenhouse gas emissions that lead to a global warming of more than 1 ,5°c above pre-industrial levels , adverse impacts on the sustainable use of natural resources , biodiversity and ecosystems. these risks include climate change and all its consequences , air , soil and water pollution , deforestation , loss in biodiversity.


### - ‘environmental risk’ means any potential or actual adverse impact that may impair the right to a healthy environment , whether temporarily or permanently , and of whatever magnitude , duration or frequency. these include , but are not limited to , adverse impacts on the climate , the sustainable use of natural resources , and biodiversity and ecosystems. these risks include climate change , air and water pollution , deforestation , loss in biodiversity , and greenhouse emissions. ### - ‘environmental risk’ means any potential or actual adverse impact that may impair the right to a healthy environment , whether temporarily or permanently. these include , but are not limited to , adverse impacts on the climate , the sustainable use of natural resources , and biodiversity and ecosystems. these risks include climate change , air and water pollution , deforestation , loss in biodiversity , and greenhouse emissions.


### - ‘governance risk’ means any potential or actual adverse impact on the good governance of a country , region or territory. these include , but are not limited to , non-compliance with oecd guidelines for multinational enterprises , chapter vii on combatting bribery , bribe solicitation and extortion and the principles of the oecd convention on combating bribery of foreign public officials in international business transactions and situations of corruption and bribery where an undertaking exercises undue influence on , or channels undue pecuniary advantages to , public officials to obtain privileges or unfair favourable treatment in breach of the law , and including situations in which an undertaking becomes improperly involved in local political activities , makes illegal campaign contributions or fails to comply with the applicable tax legislation. ### - ‘governance risk’ means any potential or actual adverse impact on the good governance of a country , region or territory.


### - ‘governance risk’ means any potential or actual adverse impact on the good governance of a country , region or territory. these include , but are not limited to , non-compliance with oecd guidelines for multinational enterprises , chapter vii on combatting bribery , bribe solicitation and extortion and the principles of the oecd convention on combating bribery of foreign public officials in international business transactions and situations of corruption and bribery where an undertaking exercises undue influence on , or channels undue pecuniary advantages to , public officials to obtain privileges or unfair favourable treatment in breach of the law , and including situations in which an undertaking becomes improperly involved in local political activities , makes illegal campaign contributions or fails to comply with the applicable tax legislation. ### - ‘governance impact’ means any adverse impact on the good governance of a country , region or territory. these include , but are not limited to , non-compliance with oecd guidelines for multinational enterprises , chapter vii on combatting bribery , bribe solicitation and extortion and the principles of the oecd convention on combating bribery of foreign public officials in international business transactions and situations of corruption and bribery where an undertaking exercises undue influence on , or channels undue pecuniary advantages to , public officials to obtain privileges or unfair favourable treatment in breach of the law , and including situations in which an undertaking becomes improperly involved in local political activities , makes illegal campaign contributions or fails to comply with the applicable tax legislation.


### 3. if an undertaking concludes that it does not cause or contribute to risks , it shall publish a statement in that sense , including its risk assessment , which shall be reviewed in the event that new risks emerge or in the event of the undertaking entering into new business relationships that can pose risks. ### 3. undertakings shall adopt and publish an appropriate statement on their due diligence policy , including a monitoring methodology to assess whether their business activities and business relationships are directly linked to potential and actual adverse human rights , environmental or governance impacts , or cause or contribute to such impacts , and shall present their plans for carrying out due diligence.


### 3. if an undertaking concludes that it does not cause or contribute to risks , it shall publish a statement in that sense , including its risk assessment , which shall be reviewed in the event that new risks emerge or in the event of the undertaking entering into new business relationships that can pose risks. ### 3. if an undertaking concludes that it is not directly linked to any risks , it shall publish a statement to that effect , including its risk assessment containing the relevant data and information that led to its conclusion , which shall be reviewed in the event that new risks emerge or in the event of the undertaking entering into new business relationships that can pose risks.


### 4. if an undertaking identifies risks , it shall establish a due diligence strategy. the due diligence strategy shall: ### 4. if an undertaking identifies risks , it shall establish and ensure the implementation of an effective due diligence strategy. the due diligence strategy shall:


### 4. if an undertaking identifies risks , it shall establish a due diligence strategy. the due diligence strategy shall: ### 4. undertakings shall establish and effectively implement a due diligence strategy. as part of their due diligence strategy , undertakings shall at a minimum:


### 4. if an undertaking identifies risks , it shall establish a due diligence strategy. the due diligence strategy shall: ### 4. undertakings shall establish a due diligence strategy. the due diligence strategy shall:


### specify the risks that the undertaking has identified as likely to be present in its operations and business relationships and the level of severity and urgency thereof. ### identify and specify the potential or actual adverse human rights , environmental and governance impacts that are likely to be present in its operations and the operations of its business relationships and the level of severity , likelihood and urgency thereof.


### i) specify the risks that the undertaking has identified as likely to be present in its operations and business relationships and the level of severity and urgency thereof. ### i) identify and specify the risks that the undertaking has identified as likely to be present in its operational processes and the processes of its business relationships , as well as the level of severity and probability of these risks;


### (ii) publicly disclose detailed , relevant and meaningful information about the undertaking’s value chain , including names , locations , and other relevant information concerning subsidiaries , suppliers and business partners in its value chain; ### (ii) with due regard for commercial confidentiality , publicly disclose detailed , relevant and meaningful information about the undertaking’s value chain , including names , locations , and other relevant information concerning subsidiaries , suppliers and business partners in its value chain;


### (ii) publicly disclose detailed , relevant and meaningful information about the undertaking’s value chain , including names , locations , and other relevant information concerning subsidiaries , suppliers and business partners in its value chain; ### (ii) map their value chain and publicly disclose detailed , relevant and meaningful information , including names , locations , types of products and services supplied , and other relevant information concerning subsidiaries , suppliers , subcontractors and business relationships;


### ii) publicly disclose detailed , relevant and meaningful information about the undertaking’s value chain , including names , locations , and other relevant information concerning subsidiaries , suppliers and business partners in its value chain; ### ii) publicly disclose detailed , relevant and meaningful information about the undertaking’s value chain , including names , product types , locations , and other relevant information concerning subsidiaries , suppliers and business partners in its value chain;


### iii) indicate the policies and measures that the undertaking intends to adopt with a view to ceasing , preventing or mitigating those risks; ### iii) indicate the policies and measures that the undertaking is adopting with a view to ceasing , preventing or mitigating potential or actual adverse impacts;


### (iii) indicate the policies and measures that the undertaking intends to adopt with a view to ceasing , preventing or mitigating those risks; ### (iii) adopt all reasonable policies and measures with a view to ceasing , preventing or mitigating potential or actual adverse impacts;