Why Adidas and Mars are calling for a new law

posted by Charlie Hart
4 September 2020

Firms including Adidas and Mars have called for EU legislation that requires firms to conduct mandatory human rights and environmental due diligence.

In a joint statement, 26 firms – including Aldi, H&M, Inditex and Unilever – said legislation was critical to ensure all businesses operate to the same standard and to build on and scale progress made on human rights and the environment to date.

While some firms have taken steps to implement due diligence processes, more companies needed to work to assess, act and report on their potential and actual impacts in these areas, the firms said. 

They said: “Mandatory legislation can contribute to a competitive level playing field, increase legal certainty about the standards expected from companies to respect human rights and the environment, clarify legal consequences for when responsibilities are not met, promote engagement and impactful actions between supply chain partners and, above all, trigger and incentivise impactful and effective actions on the ground.”

The firms added the Covid crisis demonstrated the fragility of global supply chains and the vulnerabilities for workers and communities around the world.

They said: “As we recover and rebuild, we recognise the need for new binding standards which benefit all and promote sustainability. 

“Mandatory human rights and environmental due diligence is key to ensure that efforts by companies that respect people and the planet, both during and post Covid-19 recovery, are not undercut by the lack of a uniform standard of conduct applying to all business actors.”

The firms welcomed an announcement from Didier Reynders, the European commissioner for justice, who earlier this year committed to a legislative initiative on mandatory human rights and environmental due diligence obligations for EU companies in early 2021.

They added: “EU-wide cross-sectoral legislation, reflecting national developments and with clear accountability, should harmonise these expectations towards companies, ultimately enhancing outcomes for people and the planet.”

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