The business and human rights movement has made significant gains recently. After years of struggle, courts are increasingly embracing the idea of holding multinational corporations accountable for human rights abuses and environmental damage in countries of the Global South. Legislators are supplementing this with supply chain laws that impose due diligence obligations on multinationals, often backed by administrative sanctions. Civil liability for damages is less often provided, but hailed as a particular achievement in terms of the protection of victims. However, a closer look at civil liability in recent supply chain legislation adopted in Europe raises the question of whether the hallmark of such liability may actually be its greatest weakness. Supply chain liability is regularly linked to the breach of a due diligence obligation in relation to human rights abuses or environmental damage. This is typically based on international conventions that were not written for corporations and are difficult to apply in individual cases. In contrast, this essay argues that it is better to link supply chain liability to a violation of private rights, such as personal injury or property damage. This fits better with existing tort systems and ultimately benefits victims. The hallmark of supply chain liability should not be the link to human rights, but the establishment of duties of care across legal entities.

The publication of annual sustainability reports—in which companies describe their sustainability performance and strategies—is now a routine part of doing business, especially for multinational companies. This essay examines the legal implications of inflated, misleading—or even plain false—statements made by UK companies in their sustainability reports regarding their operations and those of their subsidiaries, as well as those of entities in their supply chains. It argues that even when they are not legally mandated, these statements can carry legal significance under English tort law. It explains how in Vedanta the UK Supreme Court, applying the doctrine of “assumption of responsibility,” held that a company that states in a sustainability report that it is undertaking a specific task to prevent harm caused by a separate entity may thereby incur a duty to perform that task. Should the company fail to perform that task, and harm occur as a result, the company may incur tortious liability for its omission. This ruling has important implications for UK companies that, for both reputational and legal reasons, make statements concerning their responsibility for the conduct of entities in their supply chains. In practice, as a result of this lesser-known aspect of Vedanta, the legal position of UK companies with respect to entities in their supply chains may not be very different from that of their EU counterparts subject to the EU Corporate Sustainability Due Diligence Directive (CSDDD).

The negotiations on a treaty to regulate global supply chains and their impact on human rights will hold its tenth session in December 2024. The question the negotiations address is not completely new: previous efforts, starting in the 1970s at the United Nations,1 tried to establish international obligations for “transnational corporations” (TNC), but found the issue of defining the subject to be regulated challenging. Academia and civil society also took turns defining the concept, although much of the focus equally revolved around the issues surrounding or caused by transnational corporations (i.e., the resource curse, regulatory chill, etc.). However, the current debate in the intergovernmental working group established by the Human Rights Council has focused, among other important elements, on defining the object of regulation—transnational corporations or transnational business activities—as well as the specific forms of liability under domestic law that could be used in cases of human rights harms or environmental degradation caused by business enterprises. This contribution addresses these two issues, considering some of the debates during the ninth session, and exploring aspects that need to be considered as the process moves forward.

The recent enactment of supply chain due diligence regulation in various jurisdictions prompts reflection on how the law might best incentivize corporations to mitigate the impact they have on the environment.1 Beyond these specific pieces of legislation, judicial actors are similarly playing a role in expanding the responsibility of corporations for the harm their operations, products, and services cause to people and the environment, including throughout their supply chains. In this context, the present contribution takes aim at corporate accountability for climate change and appraises a number of recent developments in domestic jurisdictions that evidence a trend toward supply chain emission responsibility. While the focus of this piece is the contribution of domestic courts, an emphasis is placed on the role that informal international law and global norms have played in the reasoning of those decisions or the claims of litigants. In particular, it highlights the persuasive authority that such international law instruments and initiatives have had in this context.

On March 15, 2024, the Corporate Sustainability Due Diligence Directive (CSDDD or Directive) was adopted by the EU Council.1 This Directive represents the EU's first piece of mandatory due diligence legislation governing the responsibilities of companies for human rights due diligence and transition plans for climate mitigation. It also codifies the principle that “all businesses have a responsibility to respect human rights, which are universal, indivisible, interdependent and interrelated.”2 The Directive broadly follows the framework of the non-binding UN Guiding Principles on Business and Human Rights (UNGPs) which first introduced the concept of human rights due diligence.3 The CSDDD requires that businesses incorporate human rights due diligence into policies,4 identifying, assessing, preventing, mitigating, and ending actual and potential adverse human rights impacts,5 remedying any impacts and monitoring the effectiveness of these processes.6 The Directive also introduces significant sanctions for non-compliance.7

The EU Corporate Sustainability Due Diligence Directive (CSDDD) marks a significant step in the evolution of transnational corporate governance, moving away from the predominantly voluntary nature of corporate social responsibility toward a more binding regulatory framework. A key feature of this shift is the introduction of mandatory requirements for companies to adopt codes of conduct—private policies that set out standards, such as labor rights, which must be enforced across global supply chains. As expectations grew for businesses to integrate human rights and environmental risk assessments into their due diligence processes,1 codes of conduct became an increasingly common way for companies to demonstrate their commitment to social and environmental concerns. Today, nearly 80 percent of European multinationals have adopted such codes.2