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The Rise of Mandatory Human Rights Due Diligence in the Supply Chain

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CASE STUDY: ALCATEL-LUCENT ● © ECOVADIS 2015 2 1. Duty of Care: The Start of a Revolution? The French law "Devoir de Vigilance", or DdV, is designed to enforce a mandatory due diligence plan (plan de vigilance), on business enterprises and their subsidiaries, subcontractors and suppliers, aimed at preventing human rights violations caused by them. The law also covers personal injury, environmental damage, health risks and corruption. The plan must be published. 1 Since the beginning of the legislative process, French officials support the adoption of a similar legislative package at the EU level, which seems well on his way. For the first time, following the move initiated by the inception of the United Nations Guiding Principles on Business and Human Rights (UNGP) in June 2011 and the 2011 revision of the Organisation for Economic Cooperation and Development (OECD) Guidelines for Multinational Enterprises, a State has proposed a piece of legislation imposing a mandatory due diligence plan on public limited companies 2 and their supply chain addressing human rights abuses. So far, the law only covers French corporations with five thousand or more employees (including within their French subsidiaries), or ten thousand or more (including within all subsidiaries, both French and foreign). Most observers estimate the number of companies covered by the law between 150 and 200. A few of them could be subsidiaries of foreign companies. In Switzerland, a motion by the Swiss lower chamber calling for a law imposing a duty of human rights due diligence (obligation de diligence) on Swiss companies. 3 The initiative could then lead to the organisation of a binding referendum to amend the Swiss constitution. 4 Mandatory due diligence regulations are under consideration in Spain, the Netherlands and Sweden for public companies. 5 In France, it is expected that some additional provisions on business and human rights might be included in the transposition law of the "Barnier" Directive 2014/95/EU on disclosure of non-financial and diversity information by certain large undertakings and groups. The current process of implementation of the UNGP at State level, through National Action Plans (NAPs), could be an opportunity for initiatives similar to those of France and Switzerland to appear.

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