About the EU Corporate Sustainability Due Diligence Directive
Beginning in 2017, several European states including France, Germany and the Netherlands began to adopt versions of mandatory human rights due diligence legislation. This created momentum for the European Union (EU) to help level the playing field, recognising that voluntary corporate action alone is not sufficient to drive change in how people are treated in global value chains at the scale and pace that is needed.
In 2022, the EU began negotiating a draft Corporate Sustainability Due Diligence Directive (CSDDD) which was finally adopted in May 2024. Throughout the two years of negotiations, Shift was focused on engaging with policy-makers in EU Member States and in the European Parliament to help ensure the CSDDD was anchored in the international standards on sustainability due diligence – the UN Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises. Many other stakeholders also supported this call, including thousands of companies. Despite limitations with regard to the scope of companies covered under the Directive, and limited obligations with regard to due diligence on downstream business relationships, the core content of the final law was substantially aligned with the UNGPs.
Shortly after the CSDDD was enacted, the President of the European Commission announced that the Commission would bring forward a proposal to simplify requirements and reduce burdens on European companies, including in relation to the CSDDD (which had not yet even entered into force for covered companies) and the more established Corporate Sustainability Reporting Directive (CSRD). In February 2025, the Commission announced its ‘Omnibus Simplification Package I’ (‘Omnibus’). While the goals of the Omnibus were broadly reasonable ones for EU policy-makers to pursue, in fact the proposal would have made life more complicated for covered companies by requiring them to carry out parallel due diligence processes without providing meaningful protections for smaller business partners – as we explained in our March 2025 assessment of the Omnibus Proposal.
Alongside individual companies and business associations that support the UNGPs, and our civil society allies, Shift was actively involved throughout the Omnibus process to push for continued alignment with the international due diligence standards.
Where did the final CSDDD land?
In December 2025, a political agreement was reached that preserved the core of the risk-based due diligence approach in the CSDDD, as we explained in our assessment of the result. The revisions to the CSDDD were confirmed by the European Parliament and by Member States in the Council of the EU in February 2026.
The final CSDDD sets a mandatory regional standard that will have an impact not only in Europe but well beyond. Although the scope of companies covered by the Directive following the Omnibus process was reduced to only the very largest companies operating in the EU, the impact of the legislation will extend significantly beyond those companies and into their global value chains.
Crucially, the due diligence duty in the CSDDD remains substantially aligned with the international due diligence standards, making it more likely to be impactful in practice for workers and communities while remaining feasible for companies to implement. The CSDDD thus helps level the playing field for companies that have been implementing the international standards for 15 years.
EU Member States now have to transpose the CSDDD into their national laws by mid-2028 and enforcement will start from mid-2029. Meanwhile the European Commission is mandated to develop authoritative guidance on the due diligence duty that will influence enforcement by national regulators and through civil litigation.
Throughout the uncertainties created by the Omnibus process, and now as EU Member States prepare to implement the CSDDD, our advice to companies that want to know how they should respond remains the same – keep doing risk-based due diligence in line with the UNGPs. That remains the single best investment companies can make to prepare to meet current and future legislative and wider demands, whether from investors, lenders, customers, civil society or EU policy-makers. That is particularly true as other jurisdictions – including Switzerland, the UK, Australia, Thailand and Indonesia – now move to advance or debate proposals on mandatory human rights due diligence grounded in the UNGPs.
Core Resources
Our analysis
4 resources
Shift statement on the political agreement on the Omnibus Simplification Package on EU sustainability due diligence and reporting rules
December 10, 2025 _____ On Monday, 8 December, EU Member States and the European Parliament reached a provisional political agreement in trilogue negotiations – together with the European Commission – on the Omnibus I process to revise both the Corporate Sustainability Due Diligence Directive (CSDDD) and the Corporate Sustainability Reporting Directive (CSRD). The rushed and […]
The European Commission’s ‘Omnibus Simplification Proposal’: Shift’s initial reflections
06 March 2025 The European Commission has launched its Omnibus Simplification Proposal to address concerns about sustainability regulations in the EU. But measured by its own objectives of simplifying requirements and reducing burdens on smaller companies, the proposals are a remarkable own goal. Negotiations in the coming months must be grounded in a practical grasp […]
Designing an EU Due Diligence Duty that Delivers Better Outcomes
What is the CS3D? Starting in 2022, the European Union has been negotiating a draft Directive on Corporate Sustainability Due Diligence (CS3D), with discussions on a final law expected to begin by mid-2023. The draft Directive aims to ensure companies active in the single European market contribute to sustainable development by preventing and addressing negative human rights and environmental impacts. […]
Aligning the EU Due Diligence Directive with the International Standards: Key Issues in the Negotiations
Aligning the CS3D with the core concepts in the international standards The EU is currently in the process of negotiating a legal instrument that will establish new corporate human rights and environmental due diligence duties across the single market – the draft Corporate Sustainability Due Diligence Directive (CS3D). At the heart of the negotiations is […]
Previous Comments and Analysis by Shift
- Our March 2022 ANALYSIS of the Commission’s proposal for a draft Directive
- Our October 2021 Key Design Considerations for the Enforcement of Mandatory Due Diligence, developed in collaboration with the Office of the UN High Commissioner for Human Rights
- Our August 2021 viewpoint on how legislating a new standard of conduct CONNECTS TO OUTCOMES FOR PEOPLE
- Our February 2021 RESPONSE to the European Commission’s initial consultation on the need for an initiative on sustainable corporate governance
- Our February 2021 discussion draft of Signals of Seriousness for Human Rights Due Diligence, to inform how national regulators will eventually implement mandatory due diligence legislation
