Germany working to impose human rights and environmental supply chain protections by 2021

Germany is taking the lead on human rights and environmental protections in the European Union. The country plans to pass a Supply Chain Law that will oblige companies to analyze whether their business activities have an adverse effect on recognized human rights and environmental standards.

The new law will oblige German-based companies with more than 500 employees to ensure that minimum social and ecological standards are being met not only in their own supply chains but also within those of their suppliers, which are often in developing and emerging countries. The law will also require companies to take steps to counteract any breaches of minimum standards to eradicate destructive environmental practices and human rights violations.

This law has widespread support from NGOs and food and beverage manufacturers, including grocery chain Rewe, coffee manufacture Tchibo, Nestlé and Ritter Sport. An alliance of 64 nonprofits and German trade unions, including Human Rights Watch, supports the legislation. However, there is lingering controversy surrounds the proposed law. German business associations and the Minister for Economics Peter Altmaier voiced concerns that such a law would put additional burdens on companies already beleaguered by the economic ramifications of Covid-19. Despite these arguments, a report from Kearney shows that the pandemic has pushed environmental concerns even further to the forefront of consumers’ minds.

Since 2016, there has been support within the country to outline some sort of framework that establishes human rights and environmental due diligence requirements for companies. While there has yet to be any formal legislation mandating or enforcing standards, there have been plenty of voluntary efforts form private companies, and the country itself has set a goal of having 50% of its large corporations mitigating human rights and ecological violations.

However, two voluntary surveys have shown Germany is nowhere close to having 50% of its companies with more than 500 employees identifying, preventing and mitigating the adverse human rights and environmental effects associated with their business activities. In fact, in the first survey from 2019, not even 20% of surveyed companies achieve the requirements outlined in Germany’s National Action Plan on Business and Human Rights (NAP), which is based on the UN Guiding Principles for Business and Human Rights. Companies surveyed this year fared marginally better with 22% meeting NAP’s requirements.

These results show that a voluntary commitment is insufficient and has further fueled the support behind a mandatory human rights due diligence law in Germany. In 2018, the governing coalition in Germany determined that such a law would be passed should the country’s voluntary effort prove ineffective, DW reported. Now, the plan is to adopt a mandatory framework by 2021.