Financial institutions should proactively align with CSDDD, BSR says
"The CSDDD: Implications for the Finance Industry," 4 September 2024
...Looking ahead, financial institutions should adopt a pragmatic approach to CSDDD alignment. This includes conducting downstream due diligence, as this data is needed for reporting under the Corporate Sustainability Reporting Directive (CSRD) and could potentially become a requirement in the CSDDD.
Financial institutions in-scope of the CSDDD should start taking action by looking to international due diligence standards to identify management gaps, upskilling and collaborating across teams, mapping their value chains, identifying affected stakeholders, and developing a roadmap for alignment.
Preparing for Downstream Due Diligence
While downstream exclusion is a sign of misalignment with the spirit of the CSDDD’s risk-based due diligence approach (as the greatest risks to people and planet in finance are found downstream), it is critical for financial institutions to incorporate this approach into their downstream activities and relationships.
The Journey of Finance Industry Alignment with the CSDDD and Beyond
Financial institutions are encouraged to act by developing and implementing a due diligence approach that is grounded in the OECD Guidelines and the UNGPs. In June 2024, we published insights to help companies start on their journey to align with the CSDDD. While the journey may be different for each company, some key steps include assessing gaps in existing policies and management practices, upskilling and increasing collaboration across teams, mapping their value chains and identifying affected stakeholders, and establishing a roadmap for CSDDD alignment...