Corporate Sustainability Due Diligence Directive
Human Rights
10 February 2026
Summary of the Corporate Sustainability Due Diligence Directive
Region: Europe
Status: Final regulation – not yet effective
Introduction
The Corporate Sustainability Due Diligence Directive (CSDDD, Directive (EU) 2024/1760) is an EU law requiring large companies to identify, prevent, mitigate and account for adverse human-rights and environmental impacts across their own operations, subsidiaries and value chains. It aims to embed responsible business conduct into corporate governance and make sustainability due diligence an enforceable legal obligation for companies in scope.
Summary
The Directive makes human-rights and environmental due diligence mandatory (not voluntary) for companies meeting the scope thresholds.
It covers impacts in the company’s own operations, its subsidiaries and activities of business partners (i.e., value chain).
It creates obligations to adopt and implement due-diligence policies, conduct risk assessments and take proportionate preventive/mitigating actions, set targets/transition plans (where relevant), monitor effectiveness, and report publicly.
It also establishes civil liability for harm caused by failures to comply (subject to national transposition rules).
Scope and Applicability
Who is in scope (headline points from the final Directive):
Large EU companies: generally those meeting high thresholds for employee numbers and turnover (large groups as defined in the Directive).
Non-EU (third-country) companies: captured where they have a substantial presence in the EU market (turnover thresholds measured in the Union). In practice, non-EU companies that generate the required net turnover in the EU will fall within scope.
Value-chain coverage: obligations extend to the company’s own operations, subsidiaries and the operations of its direct and, in some respects, indirect business partners where the company can influence and where the risks are located.
Practical thresholds and phased scope (negotiated final text & guidance):
The Directive’s text and later legal briefings put the main quantitative thresholds at the higher end of earlier proposals (the final political negotiations raised thresholds compared with earlier drafts). Exact scope is determined by the Directive’s threshold rules (employee numbers and turnover) and the national transposition laws implementing those thresholds. National implementation will also specify the staged roll-out of obligations. Because the Directive relies on Member-State transposition, companies should check their national implementing law for the precise thresholds that will apply in their jurisdiction.
Key requirements
Below are the principal legal obligations that companies in scope must put in place:
Due-diligence policy & governance
Adopt a due-diligence policy approved at board level and integrate it into corporate governance and business models.
Risk identification & prioritisation
Establish processes to identify actual and potential adverse human-rights and environmental impacts across operations, subsidiaries and value chains; prioritise risks for action.
Preventive and mitigating actions
Take reasonable and proportionate measures to prevent or mitigate identified risks (this can include contractual measures with business partners, capacity building, supplier remediation, changing purchasing practices, etc.).
Tracking, monitoring & effectiveness
Set up monitoring systems (KPIs, audits, grievance mechanisms) to track effectiveness of measures and ensure remediation where harms occur.
Remediation & grievance mechanisms
Provide or cooperate in remediation for victims of adverse impacts (internal grievance mechanisms and cooperation with legitimate external mechanisms).
Corporate strategy & transition plans (where relevant)
For environmental harms (notably climate-related impacts), companies may need to set transition plans and targets aligned with international commitments and to be able to demonstrate progressive measures.
Public reporting & documentation
Report publicly on due-diligence policies, risk assessments, actions taken and their effectiveness. National rules will set the reporting format and enforcement measures.
Civil liability
The Directive provides for civil liability where companies fail to exercise due diligence and that failure causes harm; Member States must ensure domestic civil regimes allow victims to pursue claims (subject to national law implementing the Directive).
Compliance deadline (transposition & application)
Entry into force: Directive (EU) 2024/1760 entered into force on 25 July 2024.
Transposition by Member States: the Directive requires Member States to transpose the rules into national law. The original transposition deadline in the Directive is 26 July 2026 (i.e., two years after entry into force). National laws must be adopted and published by that date.
Phased application to companies: the Directive foresees a staggered application of obligations to companies depending on size and turnover (the Directive text and legal briefings set out staged start dates for different company-size bands). Initial enforcement of due-diligence obligations was planned to begin from 26 July 2027 for the largest companies, with subsequent waves for smaller companies in following years.
Important caveat about timing: during the political/legal process after adoption there were further proposals and “stop-the-clock” measures and follow-up amendments discussed by EU institutions which affected transposition/application timing and thresholds in late-2025 and 2026. Several legal/industry commentaries record postponement proposals and negotiations about simplifying / adjusting thresholds and application dates. Because Member-State transposition and possible later EU-level changes affect when obligations become enforceable for particular company groups, companies should rely on (a) the Directive text as the baseline and (b) their national implementing legislation for final, binding dates and precise timelines.
Practical next steps for companies (short checklist)
Check whether your company meets the Directive thresholds (employee numbers and EU/ global turnover) and whether your parent/ group structure brings you into scope.
Begin or accelerate gap assessments: map suppliers and key value-chain risks, review existing policies and grievance mechanisms.
Prepare governance changes (board oversight), contractual clauses, remediation pathways and reporting templates — these are commonly required by national transposition laws.
Downloadable link
Corporate sustainability due diligence - European Commission