Starting on January 1, 2923, a new due diligence law will come into effect in Germany. It will obligate German companies with more than 3,000 employees as well as large German branch offices of international companies to fulfil due diligence regarding human rights and environmental protection. The regulations will necessitate comprehensive risk management both within the companies and along their supply chains.
This German-language whitepaper analyses the relevant human rights and environmental risks for the German construction industry. German construction companies could face risks especially regarding work conditions and procurement of materials from abroad. At first, only a few large companies in Germany will fall under the scope of the law. However, the many smaller service providers and suppliers will probably have to satisfy a greater need for information.
Larger construction companies should not only adhere to sustainability standards, but also integrate these standards into their existing management and procurement processes. Smaller companies who directly supply them should cooperate with their clients to increase transparency along the supply chain, especially through voluntary reporting and certifications. To fulfil future legal requirements, companies in the construction industry should start preparing now. The topic will gain increasing importance, especially in view of possible EU-level regulation.