Dr. Rachel Widdis:

As proposed, smaller companies are not included in the directive. However, it contains a provision called "contractual cascading" whereby the lead company can get contractual assurances from its direct suppliers that they will cascade compliance with its code of conduct down the value chain. When we speak about large companies, we are automatically speaking about two issues. One is the proposed directive's element of contractual cascading, which is an unusual element. The lead company would still retain responsibility for verifying compliance, but that could be done by third-party initiatives. Ms Tunney mentioned the KiK case. Some jurisdictions have a chequered history in terms of how this process works. Indeed, 260 people perished in that factory fire. Companies and their value chains will be included in the directive to the extent that it has to move down the value chain with contractual cascading.

There is also an element of burden sharing. Where larger companies will be able to tell smaller ones to give them contractual assurances, the costs will fall on those smaller companies. They will be included by default, as it were, in the directive's blast radius. This is something that we need to consider in practical terms.

Ms Tunney spoke about governmental and EU negotiations, but business is also considering this matter. We need to think about what business in Ireland and globally thinks about this as well and include its perspectives. Business is moving on this in a positive sense. We do not want to be behind that movement.