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Guide To The Corporate Sustainability Due Diligence Directive 

The Corporate Sustainability Due Diligence Directive (CSDDD) is an EU law designed to make companies legally responsible for identifying and addressing negative impacts on human rights and the environment in their operations and throughout their value chains, both in and outside the EU.

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Whether you're headquartered in the EU or doing business there, CSDDD introduces binding due diligence requirements that reach beyond your own operations — extending to subsidiaries, contractors, and suppliers.

Scope

EU Companies

1,000+ employees and €450M+ net turnover

Certain franchise and licensing models (if total EU turnover is €450M+)


Non-EU Companies

If they generate €450M+ turnover in the EU

CSDDD Scope

Tentative Timeline

CSDDD tentative timeline

Why It Matters ?

Reduces risks of human rights abuses and environmental harm in global supply chains

Creates a level playing field across EU member states

Strengthens accountability and transparency for stakeholders and investors

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Key Requirements 

Identify actual and potential adverse impacts on human rights and the environment

Prevent, mitigate, or end these impacts

Adopt a due diligence policy integrated into corporate strategy

 

Establish and maintain a complaints mechanism

Monitor and assess due diligence effectiveness.

Annual and public communication of due diligence efforts

Assign responsibility for due diligence at director level

What This Looks Like In Practice ? 

  • Map supply chains and assess risks
  • Track supplier performance and collect supporting documentation
  • Engage suppliers with a clear code of conduct and contractual clauses
  • Implement a grievance mechanism (e.g. whistleblowing channel)
  • Train staff and build due diligence capacity internally
  • Incorporate due diligence oversight into board governance
CSDDD Scope

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farmer connect is a tech solution that helps companies streamline their compliance and reporting requirements. Through integration and automation, we can ensure error proof and fast data centralisation and the automated generation of reports according to reporting standards.   

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