Per this article, on June 1 2023, the EU Parliament adopted an amendment to the Corporate Sustainability Due Diligence Directive of 2022.
The proposed rules expand companies’ due diligence obligations beyond their own activities to include their value-chain-including suppliers as well as any entities related to sale, distribution or transportation. Covered companies would have to mitigate any adverse impacts as a result of value chain relationships by changing company business models, providing support to small and medium-sized entities (SMEs) in the value chain, or seeking contractual assurances from partners.
The original obligation requires large companies operating in the EU to conduct due diligence to identify, prevent, mitigate or end negative impacts on human rights and the environment, including in particular pollution, biodiversity loss and environmental degradation, as well as labor exploitation, slavery and child labor. Covered entities would be required to produce climate transition plans to align their business models and corporate strategies with the Paris Agreement’s goal of limiting global warming to 1.5°C above pre-industrial levels.