Position Paper – Corporate Sustainability Due Diligence Directive (CSDDD) – Decembre 2022

The proposal from the European Commission for a Corporate Sustainability Due Diligence Directive (CSDDD) very much focuses on the ‘S’ in ‘ESG’, bringing to light any negative impacts on social and human-related developments. Companies falling under scope would be required to perform due diligence exercises across their value/supply chain, to identify the adverse impact of their activities, and implement actions to mitigate those risks. ACA supports the overall objectives of enhanced due diligence governing human rights and environmental practices. We note however that the financial sector is already subject to an array of regulations relating to sustainable finance, therefore CSDDD should work in conjunction with those pieces and not create conflicting requirements. CSDDD requirements are specifically related to the wider Sustainable Finance framework and in our view, the concepts are not transferable to prudential or risk-based regimes, such as Solvency II. ACA continues to work with members on general ‘good business governance’ and we continue to follow CSDDD developments in this respect.