Cathal Crowe (Clare, Fianna Fail)
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143. To ask the Minister for Enterprise, Trade and Employment Ireland's position on the proposed new EU Corporate Sustainability Due Diligence directive (details supplied); and if he will make a statement on the matter. [58692/22]

Dara Calleary (Mayo, Fianna Fail)
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A proposal for a Directive on Corporate Sustainability Due Diligence (CSDD) was published by the European Commission on 23rd February 2022 and 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 chain of activities. The proposal will apply to companies across all sectors of the economy, including regulated financial undertakings in the financial sector.

Discussions have been ongoing since March at EU Working Party level. Following on from intensive negotiations over the last number of weeks, culminating in a COREPER meeting of EU ambassadors on Friday 25th November, the Czech Presidency has indicated the intention to bring the file to the forthcoming Competitiveness Council on 1st December in order to agree on a general approach.

Ireland has been supportive of the objective of the proposed Directive. An EU-wide framework is best placed to both support the functioning of the single market and to influence respect for human rights and the environment beyond the EU. Ireland has been working to ensure that the proposal has ambition while striking the right balance of providing effective protections for stakeholders whilst ensuring that the measures to be implemented by companies are clear, proportionate, and enforceable.

The proposal will promote responsible business conduct by companies and has the potential to be far-reaching and could be built upon over time. Subject to agreement on a general approach at the Competitiveness Council, the proposal will then move to trilogue discussions involving the Council, the European Commission, and the European Parliament. I look forward to a successful conclusion to this process and a final Directive being agreed at an early date.

Patrick Costello (Dublin South Central, Green Party)
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144. To ask the Minister for Enterprise, Trade and Employment the status of negotiations in relation to the Corporate Sustainability Due Diligence Directive; if he plans to ensure, as part of the Directive, that companies and financial institutions, including asset managers and institutional investors, will be held responsible for violations of human rights and environmental standards along their entire value chain; and if he will make a statement on the matter. [58696/22]

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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146. To ask the Minister for Enterprise, Trade and Employment if Ireland voted to exclude financial institutions, investments and funds from the EU Corporate Sustainability Due Diligence Directive; the reason for supporting their exclusion from the EU directive; and his views on whether such a move further damages EU efforts to clean up its value chains from environmental and human rights abuses. [58780/22]

Dara Calleary (Mayo, Fianna Fail)
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I propose to take Questions Nos. 144 and 146 together.

A proposal for a Directive on Corporate Sustainability Due Diligence (CSDD) was published by the European Commission on 23rd February 2022 and 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 chain of activities. The proposal will apply to companies across all sectors of the economy, including regulated financial undertakings in the financial sector.

Discussions have been taking place at the level of officials and there has been no vote on the proposal. Following on from intensive negotiations over the last number of weeks, culminating in a COREPER meeting of EU ambassadors on Friday 25th November, the Czech Presidency has indicated the intention to bring the file to the forthcoming Competitiveness Council on 1st December in order to agree on a general approach.

Ireland has been supportive of the objective of the proposed Directive. An EU-wide framework is best placed to both support the functioning of the single market and to influence respect for human rights and the environment beyond the EU. Ireland has been working to ensure that the proposal has ambition while striking the right balance of providing effective protections for stakeholders and ensuring that the measures to be implemented by companies are clear, proportionate, and enforceable.

I am aware of some media reports which suggested Ireland wanted the financial sector to be excluded. Ireland did not seek the exclusion of the financial sector from the proposal. However, during the discussions at EU Working Party meetings a number of practical issues were raised regarding the inclusion within scope of financial products, namely Alternative Investment Finds (AIFs) and Undertakings for Collective Investment in Transferrable Securities (UCITS). This contrasts with the approach taken in the Sustainable Finance Disclosures Regulation (SFDR), which covers financial market participants rather than financial products. In the interests of policy coherence and effective implementation, a similar approach was sought in relation to the CSDD. These financial products are no longer within scope but financial market participants remain within scope. An issue was also raised regarding the applicability of the proposal to pension institutions operating national social security schemes as their purpose in this instance is to carry out a primary social function rather than investment. The current proposal now provides discretion to Member States in this regard.

The proposal will promote responsible business conduct by companies and has the potential to be far-reaching and could be built upon over time. Subject to agreement on a general approach at the Competitiveness Council, the proposal will then move to trilogue discussions involving the Council, the European Commission and the European Parliament. I look forward to a successful conclusion to this process and a final Directive being agreed at an early date.