November 2022: Investor Statement of Support for an Ambitious and Effective European Directive on Corporate Sustainability Due Diligence

The European Commission has issued a proposal for a directive on corporate sustainability due diligence (CSDD) that seeks to embed human rights and environmental considerations in companies’ operations and corporate governance. The CSDD proposal moves beyond current disclosure requirements under the Sustainable Finance Disclosure Regulation (SFDR) and Corporate Sustainability Reporting Directive (CSRD), which require financial and non-financial companies to carry out effective due diligence, set climate targets and transition plans, and link executive remuneration with sustainability performance. This will be a transformative step forward to ensure that economic activities tied to the EU single market are conducted in a responsible manner.

However, improvements are needed to ensure a positive impact throughout the value chain, increase coherence with the EU sustainable finance framework, and enable investors to better manage their own exposure to sustainability issues.

On November 24, 2022, the Investor Alliance for Human Rights, the Principles for Responsible Investment, Eurosif and 142 signatories with approximately 1.5T in AUM issued a public statement welcoming the proposal and asking for 5 improvements to ensure that the CSDD will be an ambitious and effective directive.

Please read the investor statement here.