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A smart mix for responsible business conduct: Due diligence legislation and multi-stakeholder initiatives

25-03-2019

Poorva Karkare and Jeske van Seters, ECDPM brief, March 2019.

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There is an increasing awareness of the need to embed corporate responsibility for preserving human and labour rights as well as minimising environmental damage in the move towards responsible business conduct.

While some countries like the Netherlands and Germany have relied on multi-stakeholder initiatives, some others have introduced legislation to infuse this responsibility. However, the two tools should not be seen as a dichotomy. In fact, there may be a case to argue that the two can work together.

This briefing note looks at due diligence legislation in the UK and France. While there are significant differences, both share some similar challenges to compliance such as lack of information among businesses of the complex supply chain and the fact that individual companies cannot address systemic
challenges in the supply chain.

Multi-stakeholder initiatives can serve different purposes for different actors involved. At the same time, they too may face challenges including lack of trust, multiplicity of standards and lack of harmonisation or insufficient coverage of firms and sectors in the economy.

By looking at the UK and France, the note argues that multi-stakeholder initiatives can complement legislation, despite or rather given its deficiencies, and even be mutually reinforcing if implemented side by side. For this to happen, every actor needs to play its part in promoting responsible business conduct.


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Photo courtesy of Andrea Moroni via Flickr.

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