Sustainable corporate governance consultation response

The Danish Institute for Human Rights' (DIHR) response to the consultation focused on the development of a mandatory human rights due diligence obligation and a directors duty, and addresses:

• Need for mandatory human rights due diligence: The DIHR highlighted the findings from numerous studies showing that voluntary measures are insufficient to ensure corporate respect for human rights throughout global supply chains and there is a need to introduce a mandatory human rights due diligence measure which aligns with the UNGPs and other authoritative international frameworks.
• Scope of due diligence: Any proposed due diligence measure must be horizontal and cross sectoral, applying to all companies who supply goods or services to the EU single market, enforced by an empowered regulator and supported by a civil liability mechanism.
• Directors duties: The DIHR responded that a directors duty obliging company directors to take into account the interests of a range of stakeholders as well as the long term effects of decision making would be welcome, but alone it is insufficient. Any proposed directors duty must be accompanied by a mandatory due diligence obligation on the company.

The DIHR response draws from the expertise of the Human Rights and Business Department, which has worked for 20 years with companies, states and civil society to build a global environment in which negative impacts on human rights by business activities are minimised, including through implementation of the UN Guiding Principles on Business and Human Rights.