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Corporate Sustainability Due Diligence Directive (CSDDD)

Directive (EU) 2024/1760 of the European Parliament and of the Council of 13 June 2024 on corporate sustainability due diligence and amending Directive (EU) 2019/1937 and Regulation (EU) 2023/2859

Link: Directive (EU) 2024/1760

CSDDD

Content of this page:

Overview

The CSDDD establishes mandatory due diligence requirements for companies to identify, prevent, and mitigate adverse human rights and environmental impacts in their operations and value chains. It aims to foster responsible corporate behaviour and align business practices with EU sustainability goals.

April 2024CSDDD adopted by the European Parliament.
July 2025Stop-the-clock Directive affecting the time of adoption (EU/2025/794)
Until July 2027The national transposition must be completed by the Member states by this date.
July 2027 - July 2029Phased in application according to number of employees and global net turnovers.

Key Aspects

  • Obligation to identify, prevent, and mitigate adverse impacts on human rights and the environment.

  • Requirement to integrate due diligence into corporate policies.

  • Establishment of grievance mechanisms for stakeholders.

Scope

  • EU companies with >1,000 employees and >450 million EUR net turnover globally

  • Non-EU companies with > 450 million EUR net turnover in the EU

  • Non-EU companies with >22.5 million EUR royalties and >80 million EUR net turnover in the EU

  • Other companies may be affected indirectly

  • Staggered entry into force in three phases (adjusted in accordance with EU/2025/794) 

    • from 26.07.2028: Companies with more than 3,000 employees and revenue of 900 Mio. worldwide 

    • from 26.07.2028: Third country companies with more than 3,000 employees and revenue of 900 Mio. in the Union 

    • from 26.07.2029: Companies with more than 1,000 employees and revenue of 450 Mio. worldwide

Disclosure Requirements

  • Annual Due Diligence Statement
    Publish an annual statement on due diligence efforts within 12 months after the financial year-end and make it publicly available online.

  • Value Chain Responsibility
    Assess and address human rights and environmental risks across the full value chain, including upstream suppliers and downstream operations.

  • Integration into Corporate Policies
    Embed due diligence processes and commitments into the company’s policies and management systems.

  • Grievance Mechanisms
    Establish mechanisms to allow stakeholders to report concerns about actual or potential adverse impacts.

  • Climate Plan Requirement
    Develop and adopt a climate transition plan aligned with the Paris Agreement’s targets.

  • Integration with the CSRD
    Companies subject to the Corporate Sustainability Reporting Directive are exempt from separate CSDDD reporting obligations.

Further Aspects

  • SMEs are excluded from direct obligations but may be indirectly impacted through supply chain requirements.

  • Grievance Mechanisms

    • Establishment of accessible complaint mechanisms for affected parties such as workers, communities, and other stakeholders.

  • Civil Liability

    • Companies can be held accountable for damages caused by insufficient due diligence practices, enforcing the "polluter pays" principle.

  • Sectoral Focus

    • High-risk industries like agriculture, textiles, and extractive industries face stricter obligations due to their environmental and human rights impact.

Omnibus Initiative

As mentioned above, the time of application has been adjusted with Directive EU/2025/794. In addition, the "Content Proposal" (COM/2025/81) foresees the exclusion of financial companies from due diligence requirements, a new definition of the term stakeholder and new treatment of civil liability. 

For more details visit the Omnibus overview.

Links

EUR-Lex, CSDDD

European Commission, Corporate sustainability due diligence

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