Sustainable Economic Activity – Corporate Social Responsibility (CSR)

When people are being buried by mud when a dam is bursting in Brazil, seamstresses die in a fire in a textile factory in Bangladesh, or children are working on cocoa farms in Ghana, the supply chain too often ends with German companies. In light of the discussion on sustainability in the economy, the idea is increasingly gaining ground that companies should take responsibility for ensuring that their suppliers comply with human rights and environmental standards.

     

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Corporate Social Responsibility (CSR) stands for businesses voluntarily contributing to sustainable development and implies responsible corporate action by all market participants. Its core is the socially, ecologically, and economically responsible corporate management that impacts the entire value chain. By way of codes of conduct or CSR agreements, numerous companies obligate their contractual partners to observe minimum standards of occupational health and safety and to object to child labor, forced labor or discrimination in their companies and at their suppliers. The voluntary assumption of social responsibility is being given a legal basis in the form of binding legislation.

In 2011, the Human Rights Council of the United Nations adopted the Guiding Principles on Business and Human Rights. They form a global instrument for eliminating and preventing human rights violations in a business context. In 2015, the international community adopted the 2030 Agenda with 17 global goals for a better future based on these principles.

Legislative activities in Germany and in Europe

In 2016, the German government initiated the National Action Plan – Transposition of the UN Guiding Principles on Business and Human Rights (NAP). As only a few companies comply with their human rights due diligence in the supply chain, the German government recently published a key issues paper for a Supply Chain Act (Sorgfaltspflichtengesetz). The paper’s proposals include the option of individuals taking action against German companies for liability under civil law.
In France (Loi de Vigilance), the Netherlands (Wet Zorgplicht Kinderarbeid), and the UK (Modern Slavery Act), statutory provisions to prevent human rights violations and child labor are already in existence. In Switzerland, a vote on the “Corporate Responsibility Initiative” is scheduled for November 2020. In the EU, legislative proposals for mandatory social standards in supply chains are expected to be adopted in 2021. The EU Conflict Minerals Regulation, which imposes extensive due diligence obligations on importers of gold, wolfram, tin, and tantalum, will enter into force on January 1, 2021.

Our advisory services in the area of Corporate Social Responsibility

The lawyers of our Corporate Social Responsibility (CSR) task force advise companies, public institutions, and organizations on all aspects of the current and dynamic field of business, environment and human rights, offering the following services:

  • We provide you with an overview of existing national, European, and international legal requirements for sustainable economic activity, keeping you informed of all current legislative activities and their effects. We also advise you on how to take the correct steps at an early stage to effectively and economically implement the legal requirements in the areas of CSR, human rights, social standards, sustainability, and the environment in your company.
  • We develop and implement effective compliance and risk management systems for our clients to ensure due diligence in global supply chains or support the extension of your existing systems with the element “supply chain compliance.”
  • We design customized sets of rules and codes of conduct (Supplier Code of Conduct, Business Codes, CSR agreements). We review your distribution and supply agreements and adapt them with you in terms of CSR and sustainability requirements.
  • We support our clients in joining industry codes and implementing them, thus limiting corporate liability.
  • We develop a concept for effective supply chain management for your company, define your future supply chain policy, establish early warning systems, and set up a functioning complaint management system.
  • We work with you to establish suitable sustainability and CSR reporting and notification systems for customers, authorities, and the public that meet statutory requirements and support your positive corporate communication.
  • Jointly with you, we review the measures your company has taken so far to comply with legal and contractual sustainability requirements. We suggest necessary adjustments so that your business is not impacted by negative consequences such as liquidated damages, fines, or exclusion from public contracts.
  • We examine CSR issues and the observance of human rights in the context of corporate transactions (human rights due diligence), draft a risk and impact assessment, and implement the recommendations and results of our audits with you in your company.
  • We assist you in litigation related to human rights violations, due diligence violations, and disputes in global supply chains.
  • We advise you on all reputation issues for your company in connection with CSR, supporting your crisis management.
  • We advise you on the liability of your general managers and executive board members in the event of breaches of due diligence.

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