Meta study on impact measurements of different due diligence implementation approaches

Companies increasingly have business relationships along global supply chains, most of which originate in developing and emerging countries. Raw materials, intermediate products and end products that are processed or sold in Germany and Europe were previously mined or produced in countries of the Global South. While this can offer several development opportunities, countries of the Global South face several negative impacts on human rights and the environment like child labour and modern slavery, carbon emissions and air pollution, water shortages and deforestation or worker health and safety issues. 

To increase sustainability and responsibility in corporate activities, a variety of different approaches, both voluntary and mandatory, have been implemented in recent years, with the approach of corporate due diligence gaining importance in recent years. Since the introduction of the United Nations Guiding Principles for Business and Human Rights (UNGP) and the revision of the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct (OECD Guidelines) in 2011, many different voluntary and mandatory due diligence schemes, initiatives or regulations emerged. Various evaluations have shown, that the voluntary implementation of due diligence is not sufficient, which is why more and more mandatory regulations have been enacted in recent years. Examples of mandatory due diligence legislation are the French Loi de Vigilance, the British Modern Slavery Act, the Dutch Child Labour Due Diligence Law, or the German Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz – LkSG). The EU Corporate Sustainability Due Diligence Directive (CSDDD) was under negotiation at the time and thus not analysed.

As due diligence approaches are comparatively new, the impact on companies and the people most affected by human rights and environmental risks is either not clear or is only illustrated using selected examples of good practice. In order to gain an overview of the impact of different approaches, adelphi developed a meta study report of all publicly available impact measurements in order to draw conclusions for the future work of the GIZ cluster "Sustainable Supply Chains" and BMZ. The study analysed three areas for impact measurement:

- mandatory regulatory due diligence approaches
- sustainability initiatives like multi-stakeholder initiatives, membership initiatives and other voluntary schemes
- corporate due diligence approaches