On May 24, the European Council formally adopted the European Parliament’s position on the Corporate Sustainability Due Diligence Directive (CSDDD or CS3D). This final approval marked the culmination of a decision-making process that began over two years ago, during which the CSDDD was significantly diluted from its original proposal.
 
Once signed by the President of the European Parliament and the President of the Council, the CSDDD will be published in the Official Journal of the European Union and will take effect twenty days after publication. Member states will have two years to implement the necessary regulations and administrative procedures to comply with the directive.
 
The CSDDD imposes obligations on large companies to identify, assess, prevent, mitigate, address, and remedy impacts on people and the planet. These impacts range from child labor and slavery to pollution, emissions, deforestation, and ecosystem damage. The rules apply not only to the companies’ operations but also to their subsidiaries and business partners along the supply chain.
 

The CSDDD will be phased in over five years. Companies with 5,000 employees and a turnover of EUR 1,500 million will be affected in 2027. Companies with 3,000 employees and a turnover of EUR 900 million will be affected in 2028. Companies with 1,000 employees and a turnover of EUR 450 million will be affected in 2029.