EU Sustainability Regulations in 2024

Have these on your radar and get ready with another anti-greenwashing checklist.

Welcome to The Crisps–your weekly newsletter on anti-greenwashing and honest fashion communication. In this issue, you will get an outlook on EU Reporting Guidelines and Legal Regulations that you should keep in mind for 2024 and beyond.

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Not sure if you’re all set for the legal frameworks in 2024 and beyond? Then this issue is for you! We’ll give you an overview of 3 coming and active guidelines and regulations. Not that exciting for most of us. But VERY important to know and understand. So stick with us!

We will be focusing on the EU in this issue but we promise to cover other continents and countries very soon. Big promise!

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The German Act on Corporate Due Diligence Obligations in Supply Chains

The German Act on Corporate Due Diligence Obligations in Supply Chains, also known as the German Supply Chain Law, “aims at improving respect for human rights (including banning child labour and forced labour) and environmental standards (for example with regard to mercury or waste management) in global supply chains”. It came into effect in January 2023 and is applicable for companies with 1.000 or more employees since January 1, 2024. The law is directed at “companies that either have their headquarters in Germany or have a branch in Germany”. ¹

Here's how it will likely influence the way companies communicate their sustainability practices:

• The law mandates due diligence throughout the supply chain, requiring companies to identify, prevent, and mitigate human rights and environmental risks. Greenwashing, or deceptive communication about sustainability efforts, may be exposed through the required due diligence processes.

• To comply with the law, companies will need to communicate transparently about their supply chain practices in a yearly report. This transparency extends not only to positive aspects but also to challenges and areas for improvement. This is made available to the public and to the responsible authority in Germany. Greenwashing attempts may be challenged, necessitating a more authentic and accountable approach to communication.

• Non-compliance with the German Supply Chain Law can result in legal consequences, fines, and reputational damage. Keep in mind that stakeholders, including consumers, investors, and regulatory bodies may closely examine the transparency and authenticity of sustainability claims your company report is putting out.

• Companies might engage in collaborative efforts with suppliers and partners to ensure compliance with the law. Verifiable evidence of sustainability practices will become crucial, and greenwashing attempts may be challenged by stakeholders seeking concrete proof of ethical and environmental actions. So have your facts straight!

• Companies need to align their communication strategies with the objectives of the German Supply Chain Law. This includes emphasizing genuine efforts to address human rights and environmental issues, rather than merely presenting a superficial image of sustainability.

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