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27 Dec 2023

CorA-Netzwerk, Kampagne für Saubere Kleidung & Initiative Lieferkettengesetz

The German Supply Chain Act 1 year on: Civil society networks see initial positive impacts

[Unofficial Resource Centre translation of the German original]

Joint press release by CorA Network for Corporate Accountability, Clean Clothes Campaign Germany and Supply Chain Act Initiative : 'One year of German Supply Chain Act: Civil society sees first positive effects'

Taking stock one year after the Supply Chain Due Diligence Act entered into force, civil society networks provide an initial positive assessment: companies are intensifying their human rights risk management, and affected people, human rights organisations and trade unions are beginning to use the complaints mechanism. However, the Supply Chain Act Initiative, Clean Clothes Campaign Germany and CorA network also see room for improvement in the future.

On 1 January 2023, the Supply Chain Due Diligence Act introduced legally binding obligations for certain German companies to respect human rights and environmental standards in their supply chains. From 2024, further companies will be covered by the [Supply Chain Act], while at the same time a European law is close to finalisation.

Heike Drillisch, coordinator of the CorA Network for Corporate Responsibility, comments: "The first year of the Supply Chain Act has shown that it is working: together with those affected, organisations from our network have submitted initial complaints to the supervisory authority, but companies are also clearly showing that they are working on their supply chains and paying more attention to the issue."

Drillisch emphasises the responsibility of the competent authority, the Federal Office for Economic Affairs and Export Control (BAFA): "It is crucial that BAFA addresses the concerns of smaller companies and that it has made clear: due diligence obligations must not be passed on or outsourced to suppliers. Instead, companies must address risks in partnership and adapt their own business and purchasing practices."

[A] suspension of the Supply Chain Act's reporting obligations, as was recently called for by Minister for Economy Robert Habeck, must not be enforced. "The reports on risk management and measures taken are not useless bureaucracy, but essential for checking whether companies are adequately fulfilling their due diligence obligations. Weakening them would be both counterproductive for the protection of those affected and in disregard of all companies that have already taken action in accordance with the [Supply Chain Act]."

"The German Supply Chain Act provides important levers for change," comments Artemisa Ljarja, casework coordinator at the Clean Clothes Campaign, on the experiences from the textile sector, where labour rights abuses occur time and again. "Companies are now required to set up complaints mechanisms themselves and to respond to notifications received from those affected. This strengthens the position of affected people, NGOs and trade unions in dialogue with companies. It is crucial that companies ensure workers in the supply chain are aware of grievance procedures and promote accessibility as well as trust in their use."

With regard to the administrative complaints procedure at BAFA, Ljarja emphasises: "Affected people are not only experts on the situation on the ground, but also regarding what measures are appropriate and effective in individual cases, for example to sustainably improve working conditions. They must therefore be fully involved in the processes for handling complaints."

Michelle Trimborn, spokesperson for the Supply Chain Act Initiative, explains with regard to the forthcoming EU law: "The weaknesses of the German Supply Chain Act can and must be rectified. For example, the EU Due Diligence Directive will add important civil liability provisions for those affected. The German Government and German Members of the European Parliament must now contribute to a swift final decision on the directive in the EU Council and Parliament."