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Sustainability Clauses in Commercial Contracts: The Key to Corporate Responsibility

April 4, 2019

New regulations along with consumer and stakeholder pressure regarding sustainability issues have made it crucial for businesses to manage and demonstrate their due diligence on environmental, social and ethical risks in their business relationships, especially in their value chain. As a result, companies, now more than ever, are including Corporate Social Responsibility (CSR) requirements in their contracts, in the form of a so-called sustainability clause or CSR clause. This practice can significantly contribute to supplier performance improvement and prove highly effective for CSR and CSR strategy.

 

Studies on sustainability clauses are scarce, and one of this scale is unprecedented.  CSR practices are constantly evolving to respond to changing social and legal pressures. The aim of this study is to give a practical, reality-based overview of current practices. It discusses both, formal considerations, e.g. what should be included in a CSR clause, and operational considerations, e.g. practical consequences of CSR clauses.

 

EcoVadis partnered with Affectio Mutandi to ensure the study reflects real-life practice and provides expert legal analysis for the study.

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