Section 54 of the UK Modern Slavery Act 2015 (MSA 2015) requires large businesses to produce a statement each year setting out the steps they have taken to ensure that their business and supply chains are slavery free, or a statement that they have taken no steps to do this. Legislative reform of some kind has been some time in the offing, particularly since the Government’s response in September last year to the 2019 “Transparency in supply chains consultation” (see our previous Legal Update).
Continue Reading UK Modern Slavery – a Bill to prohibit the “falsification” of slavery and human trafficking statements

On June 11, 2021, the German parliament passed the “Law on corporate due diligence in supply chains” (“Supply Chain Law”) (“Lieferkettensorgfaltspflichtengesetz”). It requires companies to take steps to prevent human rights violations in their supply chains. This builds on the growing momentum for mandatory human rights due diligence (see our previous blog posts here and here).
Continue Reading Business and Human Rights – Germany passes Mandatory Human Rights Due Diligence Law

The European Coalition for Corporate Justice, European Center for Constitutional and Human Rights and Initiative Lieferkettengesetz reflect, in a Business and Human Rights Resource Centre Paper entitled “Towards EU Mandatory Due Diligence Legislation”, on insights from past efforts of companies to advance responsible business conduct and monitor their supply chain. Among other things, they caution against relying on “policing” suppliers through social audits and warn that private auditing and certification must not become a synonym for human rights and environmental due diligence. According to the Paper:

Private auditing and certification must not become a surrogate for the human rights and environmental due diligence of companies. Auditing and certification failures are widespread, ranging from garment factory collapses and fires (Rana Plaza, Ali Enterprise, Tazreen) to dam collapses, resulting in thousands of avoidable deaths and injuries. We now know these mechanisms under-identify and under-document risks and impacts, and can serve as a ‘fig leaf’ disguising actual negative impacts. Currently this multi-billion euro compliance industry goes about unchecked and unregulated with various inherent conflicts of interest.”

In this Blog Post, we discuss the future of social auditing, including with respect to emerging human rights due diligence legislation, and practical steps that businesses can take today to position themselves for the future of human rights due diligence.


Continue Reading Business and Human Rights: Pitfalls Of Social Auditing

The EU Green Deal announces the circular economy goal, which can only be achieved with the full mobilization of society and industry through the implementation of an integral EU policy for sustainability. Products and services should progressively become more “sustainable”, “environmentally friendly” and “green” and, ultimately, more respectful to the environment and society.

In line with this new trend, more and more companies advertise their products using a wide variety of “sustainability” and “green claims” (we note that the two terms do not have the same meaning, but will not focus on this distinction in the present short overview). Consumers often report being lost when navigating among all these numerous ecological labels, sustainability certification schemes and various self-made claims. Inevitably, this difficulty has a negative impact on brand credibility, the level playing field among the operators on the market and the overall level of consumer trust.

In such context, the European Commission has announced that companies will soon have to substantiate any sustainability or green claims they use in line with new harmonized EU rules and, most likely, a standard EU methodology capable of assessing, in a uniform manner, the impacts of products and services on the environment. These rules may also be accompanied by specific EU measures against “greenwashing”, possibly including sanctions. The forthcoming legislation should ensure fair competition on the EU market and boost the consumers’ trust.

In this Blog Post, we discuss important considerations for any company advertising sustainability or green claims, as well as the coming EU regulation in this space.Continue Reading Advertising “Sustainability” and “Green Claims” in Products and Services in the EU: Fancy Commercial Practice Can Be a Real Legal Challenge

On March 10, 2021, the UK government concluded its public consultation on climate risk regulations under the Pension Schemes Act 2021. The government is now analyzing public feedback and preparing consultation conclusions.

In a new podcast, Mayer Brown Counsel Beth Brown provides background on the Pension Schemes Act 2021 and outlines the regulations in the

On March 3, 2021, the German government adopted a draft bill which obliges companies to ensure that human rights are observed throughout their entire supply chain. The aim of the “draft legislation on corporate due diligence in supply chains” (“Draft Bill”) (“Sorgfaltspflichtengesetz”) is to require companies to take steps to prevent human rights violations in their supply chains. This builds on the growing momentum for mandatory human rights due diligence (see our previous Blog Post).

Under the Draft Bill:

  • companies must ensure that human rights are being respected throughout their entire supply chain;
  • companies must establish complaint mechanisms and report on their due diligence activities;
  • companies with more than 3,000 employees must meet their due diligence obligations as of January 1, 2023 (and companies with more than 1,000 employees as of 2024);
  • violations of the obligations set forth in the Draft Bill will be sanctioned with fines, which can amount to up to 2% of the average annual turnover for large companies with more than 400 million euros annual turnover.

Continue Reading Business and Human Rights – Germany Adopts Draft Mandatory Human Rights Due Diligence Law

The UK’s Pension Schemes Act 2021 recently received Royal Assent on February 11, 2021. The Act addresses a range of initiatives intended to strengthen protections for pension scheme members, including a framework for new climate risk-related governance and reporting requirements for trustees of larger pension schemes.

The government is currently consulting on the details of

The European Commission has committed to tabling an EU-wide human rights due diligence law by June 2021.

There are strong indications that the proposed law will have a wide scope (with the potential to apply to non-EU domiciled companies) and contain sanctions for non-compliance.

But what is human rights due diligence, and how can companies prepare for the proposed EU law?Continue Reading The EU’s Proposed Mandatory Human Rights Due Diligence Law – What You Need to Know