Corporate social responsibility legislation mooted

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In early March, ChristenUnie along with GroenLinks, PvdA and SP submitted a bill to parliament that would oblige companies to comply with international OECD standards corporate social responsibility. The bill creates a duty of care for all companies in the Netherlands to prevent human rights violations and environmental damage.

The initiative represents a major step forward in enhancing awareness of the impact of human rights violations and of improved labour and living conditions for millions of people around the world. 

Companies with over 250 employees will be obliged to carry out the six steps of appropriate care in line with the OECD guidelines for multinational companies, see below. Enforcement of the law will be supervised by a regulator, who may issue instructions and can impose administrative penalties and orders subject to penalties. With the adoption of the bill the Netherlands will follow France, where such legislation came into force in 2017 and Germany, where CSR legislation will be introduced in 2023. 

One of the first and most important steps, but certainly not the easiest, is to identify the risk for individuals of adverse consequences of a company's activities, products or services. Based on this, high-risk circumstances should be the highest priority for company action since they present the greatest risks to individuals. Moreover, high-risk circumstances for human rights often present high risk to the business as well, including commercial, reputational, investor-related and legal risks. 

To identify high risks circumstances we advise using practical tools and engaging with internal and stakeholders.