Dara Calleary (Mayo, Fianna Fail) | Oireachtas source

I thank Deputy O’Reilly for the question on the proposal for a directive on corporate sustainability due diligence, CSDD, which was published by the European Commission on 23 February 2022. It addresses corporate behaviour and due diligence processes for the companies within its scope. The proposal focuses on establishing a system within company law and corporate governance to address adverse human rights and environmental impacts arising from companies' own operations, their subsidiaries' operations and their value chains.

At the outset I wish to state that Ireland is supportive of the objective of the proposed directive, which should promote responsible business conduct and is seeking to ensure that the proposals strike the right balance by providing effective protections while ensuring that the measures to be implemented by companies are clear, proportionate and enforceable. The proposal will apply to large companies, both EU and non-EU. SMEs are not directly within scope but may be indirectly impacted under the proposal, for example, if they are part of a large company's supply chain.

The proposal has the potential to be far reaching and it is vital that we get it right. Good progress has been made in discussions to date at EU level but further work is needed to clarify aspects of the proposal, ensure that the practical implications are well understood and that the obligations on companies are reasonable and effective. For example there has been relatively little discussion of financial sector aspects of the proposal and clarification has been sought on the interaction of the proposal with the suite of existing regulation in the financial sector. Fundamental issues relating to the scope and definitions remain and are currently under discussion. There is considerable interest in the proposal across a wide range of interests and my Department has been actively engaging with stakeholders, including civil society organisations and business representative organisations, since the proposal was published. Officials in my Department have met members of the Irish Coalition for Business and Human Rights, ICBHR, and with the UN special rapporteur on human rights defenders, the latest of which was two weeks ago. I myself will be meeting both groups in the coming weeks.

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