Introduction
Our world clock ticks.
This is the CO2 clock of the Mercator Research Institute on Global Commons and Climate Change (as of 01 December 2022). It indicates how much CO2 may be released into the atmosphere to limit global warming to a maximum of 1.5°C and 2°C, respectively.
Paris Climate Agreement
Article 2(1) of the Paris Climate Agreement sets a legally binding limit for all countries on global warming of 1.5 degrees above pre-industrial levels, but at least well below 2 degrees. According to the Intergovernmental Panel on Climate Change, however, such a limit can only be implemented if all emissions worldwide are brought to zero in one to two decades. At the same time, the United Nations Global Convention on Biological Diversity stipulates that species loss must be halted and reversed. The EU and Germany are miles away from both goals. As of January 1, 2023, the Supply Chain Sourcing Obligations Act (LkSG) will therefore initially come into force in Germany. But the European one is already in the starting blocks. Read here:
Brief summary of the German LkSG and which companies are affected by it and how the European LkSG and its core challenges for companies
What obligations companies will face.
LkSG/ Supply Chain Act: The duty to be transparent is coming
The LkSG will define what obligations companies have in complying with the protection of human rights and environmental rights, and will specifically hold companies accountable for identifying, preventing, ending, or at least minimizing risks and violations of human and environmental rights along their supply chains.
Penalty in the amount of up to 2%
of the total annual turnover.
If companies violate the LkSG after it has come into force, management must expect severe sanctions such as a restriction of market access and further legal consequences against the company as well as liability risks (penalties of up to 2% of the total annual turnover).
LkSG affects companies
The LkSG will initially apply from January 2023 to companies domiciled in Germany and companies with a branch pursuant to Section 13 d of the German Commercial Code (HGB) with at least 3,000 employees in Germany. From January 2024, the law will then apply to companies with at least 1,000 employees in Germany.
Trickle Down: LkSG affects a variaty of companies indirectly.
The responsibility of companies will not only relate to their direct suppliers and partners. In the future, the scope of responsibility will extend to the entire supply chain, including their indirect suppliers! This is because affected companies will oblige their contractual partners to take appropriate actions and disclose their supply chain in order to comply with their own legal obligations. This indirectly affects tens of thousands of small and medium-sized enterprises in Germany alone.
As you can see, this development will by no means only affect a select group of companies. Firstly, companies always work in an integrated and mostly global network. And secondly, the LkSG is taking the leap onto the European stage.
LkSG on European level
The EU is already working on an overarching draft law in Europe and will bring different national supply chain laws to similar standards. As a European law, it can be stricter and more consistent than national laws such as the German or, for example, the French supply chain law.
To which companies does the EU Supply Chain Act apply
For companies that have more than 500 employees and a turnover of more than 150 million euros.
If they have more than 20 million euros in sales in risk sectors, the sales threshold drops to 40 million euros and the employee threshold drops to 250.
The risk sectors include textile, agriculture, food, raw material extraction, metal processing, among others. Mechanical engineering is excluded.
For companies from third countries, a threshold of more than EUR 150 million in annual sales in the EU (i.e. no employee threshold) or EUR 40 - 150 million in annual sales in the EU with at least EUR 20 million in risk sectors applies.
No safe harbor
The so-called safe harbor clause could certainly have made life easier for many companies: According to this clause, lawsuits in the event of violations within supply chains would hardly have been possible once external auditors had confirmed to European companies that their supply chains were flawless.
However, this safe harbor cannot be reached now, as the Council of Ministers has not complied with the German government's request to introduce such a clause. On the contrary, there will be three massive tightenings within the EU supply chain law:
3 central tightenings
Unlike the German Supply Chain Act, victims of human rights violations can also enforce civil liability!
The EU law basically obliges all suppliers - not only those with a long-term established business relationship, as originally planned by the EU Commission.
In the German Supply Chain Act, the involvement of intermediate companies can circumvent the obligations. According to the will of the member states, this circumvention option is now closed throughout Europe.
Managing global risks internally
In the future, companies will have to provide evidence of the implementation of numerous measures:
Establishment and anchoring of a risk management system within the company: Anchoring clear responsibilities within the company for the purpose of monitoring.
Conduct risk analysis: Identify, assess and prioritize relevant human rights and other risks.
Policy statement of the Board of Management on human rights strategy: Communication of the same to internal and external stakeholders
Establishment of preventive measures: Appropriate measures within own business unit as well as with direct suppliers
Taking corrective action: When a violation is identified in own business unit or with an immediate supplier
Intra-company complaint procedures: To enable reporting of human rights and environmental violations.
Ongoing documentation and reporting requirements: With regard to the measures implemented
The LkSG will have profound consequences, as it will affect countless areas of the company and change structures here.Both the German and the European LkSG are integrated into the so-called circular economy, which is experiencing a true renaissance. Read the most important facts:
Quellennachweise und zum Weiterlesen (Stand Februar 2023)
Lieferkettensorgfaltspflichtengesetz (LkSG)
Hembach, Holger (2022): Praxisleitfaden Lieferkettensorgfaltspflichtengesetz (LkSG) (CB - Compliance Berater Schriftenreihe). Fachmedien Recht und Wirtschaft in Deutscher Fachverlag GmbH; 1. Auflage.
Jürgens, Max / Harings, Lothar (2022): Das Lieferkettensorgfaltspflichtengesetz: Umsetzung und Auswirkungen des LkSG in der Praxis. Reguvis Fachmedien; 1. Edition.
Grabosch, Robert (Hrsg.) (2021): Das neue Lieferkettensorgfaltspflichtengesetz. Nomos; 1. Edition.
Falder, Roland / Frank-Fahle, Constantin / Poleacov, Peter (2022): Lieferkettensorgfaltspflichtengesetz: Ein Überblick für Praktiker
Springer Gabler; 1. Aufl. 2022 Edition (7. Mai 2022)
BMAS Das Lieferkettensorgfaltspflichtengesetz
CSR in Deutschland - Das Lieferkettensorgfaltspflichtengesetz
Deutscher Bundestag verabschiedet Lieferkettensorgfaltspflichtengesetz
Deloitte: Lieferkettensorgfaltspflichtengesetz in der Praxis
Bayerischer Rundfunk: EU-Länder einigen sich grundsätzlich auf Lieferkettengesetz
Die Initiative Lieferkettengesetz: https://lieferkettengesetz.de
Absatzwirtschaft: Nachhaltigkeit in der Lieferkette: Zeit für Gerechtigkeit
Kreislaufwirtschaft
Rau, Thomas / Oberhuber, Sabine (2021): Material Matters: Wie eine neu gedachte Circular Economy uns zukunftsfähig macht | Die Antwort auf die Klimakrise ist die Kreislaufwirtschaft. Econ; 1. Edition
Münger, Alfred (2021): Kreislaufwirtschaft als Strategie der Zukunft: Nachhaltige Geschäftsmodelle entwickeln und umsetzen. Haufe; 1. Auflage
Beckmann, Martin (2022): Kreislaufwirtschaftsgesetz: Kreislaufwirtschafts- und Abfallgesetz mit Verordnungen, Abfallverbringungsrecht. beck im dtv; 23. Edition
Europäisches Parlament: Recht auf Reparatur: Für Produkte, die langlebiger und reparierbar sind
VDI: Zirkuläre Wertschöpfung. Werkstoffliches und chemisches Recycling von Kunststoffabfällen
Europäisches Parlament Ökodesign-Richtlinie: Steigerung der Energieeffizienz und Recyclingfähigkeit
BMUV zur Kreislaufwirtschaft: https://www.bmuv.de/themen/wasser-ressourcen-abfall/kreislaufwirtschaft
Europäische Kommission: Circular economy action plan (CEAP): https://environment.ec.europa.eu/strategy/circular-economy-action-plan_en
Europäische Kommission zum neuen Aktionsplan der Kreislaufwirtschaft: https://ec.europa.eu/commission/presscorner/detail/de/ip_20_420
Recyclingnews: EU-Kommission will nachhaltige Produkte zur Norm machen
EUR Lex (Zugang zu den Originaltexten) A new Circular Economy Action Plan:
Umweltbundesamt: Abfall- und Kreislaufwirtschaft
NABU: Kreislaufwirtschaft:
Koalitionsvertrag ZWISCHEN SPD, BÜNDNIS 90/DIE GRÜNEN UND FDP: MEHR FORTSCHRITT WAGEN. BÜNDNIS FÜR FREIHEIT, GERECHTIGKEIT UND NACHHALTIGKEIT:
United Nations Global Compact: https://www.unglobalcompact.org/library/205
United Nations Global Compact: Nachhaltigkeit in der Lieferkette:
Deutsche Umwelthilfe: Nachhaltige Lieferketten: https://www.duh.de/themen/natur/naturvertraegliche-landnutzung/nachhaltige-lieferketten/
Europäer Green Deal
BMUV Den ökologischen Wandel gestalten. Integriertes Umweltprogramm 2030.
brand eins Sonderausgabe Der neue grüne Deal Dezember 2020
Bestell-Link: https://www.brandeins.de/magazine/brand-eins-wirtschaftsmagazin/2020/unterhaltung/folge-01-ein-pakt-fuer-gesundes-wachstum
Europäisches Parlament Ökodesign-Richtlinie: Steigerung der Energieeffizienz und Recyclingfähigkeit
Europäische Kommission: Der Grüne Deal
Bundeszentrale für politische Bildung: The European Green Deal:
DIHK: Worum geht es beim Green Deal?
Ökodesign-Richtlinie
EUR Lex (Originaltexte): On making sustainable products the norm
Umweltbundesamt: Ökodesign-Richtlinie
Süddeutsche Zeitung, 28. März 2022: Wie die EU Produkte ökologischer macht
Europäisches Parlament Ökodesign-Richtlinie: Steigerung der Energieeffizienz und Recyclingfähigkeit
Sustainable Development Goals (SDG)
BMZ: Die globalen Ziele für nachhaltige Entwicklung
IHK: Die UN Nachhaltigkeitsziele (SDGs) als Maßstab für verantwortungsvolles Unternehmertum
United Nations Global Compact: https://www.unglobalcompact.org
Recycling
BMUV: Kreislaufwirtschaftsgesetz
BMBF (Plastik): WErtschöpfungsketten gestalten
Rohstoffwissen: https://www.rohstoffwissen.org/initiative/rohstoffkreislauf/
Stiftung zentrale Stelle Verpackungsregister: Mindeststandard recyclinggerechtes Design: https://www.verpackungsregister.org/stiftung-behoerde/mindeststandard-21/grundlegende-informationen
Europäisches Parlament: Recht auf Reparatur: Für Produkte, die langlebiger und reparierbar sind
VDI Zentrum Ressourceneffizienz: https://www.ressource-deutschland.de
Recyclingnews: EU-Kommission will nachhaltige Produkte zur Norm machen
Europäisches Parlament Ökodesign-Richtlinie: Steigerung der Energieeffizienz und Recyclingfähigkeit
ESG & Nachhaltigkeitsberichterstattung
Rat der Europäischen Union: Neue Vorschriften für die Nachhaltigkeitsberichterstattung von Unternehmen: vorläufige politische Einigung zwischen Rat und Europäischem Parlament
Regularien zum Greenwashing
BMUV Den ökologischen Wandel gestalten. Integriertes Umweltprogramm 2030.
Europäische Kommision: Unfair commercial practices directive
Europäische Kommision: Kreislaufwirtschaft: Kommission schlägt neue Verbraucherrechte vor und will Greenwashing verbieten
NKS / Bundesministerium für Bildung und Forschung: EU legt Vorschläge für nachhaltige Produkte vor
Digitaler Produktpass (DPP)
Digtler Produkpass
Europäisches Parlament Ökodesign-Richtlinie: Steigerung der Energieeffizienz und Recyclingfähigkeit
BMUV Der BMU Design-Sprint zum Digitalen Produktpass für die Elektromobilität
Umweltbundesamt Förderung des nachhaltigen Konsums durch digitale
Produktinformationen: Bestandsaufnahme und Handlungsempfehlungen
BDI Der „Digitale Produktpass“ auf dem Prüfstand
Recyclingnews: EU-Kommission will nachhaltige Produkte zur Norm machen
DKE Digitaler Produktpass: Förderung der Digitalisierung und Kreislaufwirtschaft durch standardisierte Daten
Europäische Kommission: Circular economy action plan (CEAP): https://environment.ec.europa.eu/strategy/circular-economy-action-plan_en