Robert Troy (Longford-Westmeath, Fianna Fail) | Oireachtas source

I apologise to the House. Strangely enough, I was not able to arrange a pair so I had to go to vote in the Dáil.

I thank Senator Ahearn for raising this important issue and for giving us the opportunity to discuss it. A proposal for a directive on corporate sustainability due diligence was published by the European Commission on 23 February 2022. The proposal aims to address the adverse environmental and human rights impacts arising from the operations of companies and those of their subsidiaries and value chains.Such companies will be required to conduct human rights and environmental due diligence to identify actual or potential adverse impacts and prevent, mitigate or minimise the extent of such impacts within their own operations, their subsidiaries and their value chains. The effectiveness of the due diligence measures must be assessed at least annually. Company directors will be required to take into account the consequences of their decisions in areas such as human rights, climate change and environmental impacts.

Companies will be required to establish procedures to handle complaints from those adversely affected by company operations and from other key stakeholders. The proposal also provides for the designation of supervisory authorities at national level and a civil liability regime in terms of companies who fail to meet their obligations.

The proposal contains a definition for "stakeholder" which is broadly defined and encompasses a company’s employees, the employees of its subsidiaries, and other individuals, groups, communities or entities whose rights or interests are, or could be, affected by the products, services and operations of the company, its subsidiaries or its business relationships. I remain committed to ensuring that the interests and rights of all stakeholders are appropriately protected under the proposal and, should it be warranted, consider whether it is necessary for specific stakeholders to be defined under the directive.

I want to reassure the Senator that the proposal is at a very early stage and is ongoing across EU member states. My Department is engaging at EU working party level to clarify the practical implications of what has been proposed. Given the complexity of the issues being addressed, negotiations at EU level may well continue through the remainder of this year and, in fact, go into 2023. Decisions on how the proposal will be legislated for in an Irish context will be taken once the directive has been finalised.

Recognising the importance of this directive, my Department has begun a process of engagement with key stakeholders and intends conducting a public consultation on the proposal in the next number of months to help inform the Government's position. Ultimately, in informing the Government's position, it can ensure that we have our ethical values and, indeed, as mentioned by the Senator, our strong track record on human rights enshrined in this directive when it is published later this year or early next year.