Overview

• Under the Council’s position, the directive would apply only to companies with more than 5,000 employees or at least €1.5 billion in net turnover.
• That change would shrink the pool of firms subject to the directive to under 1,000 compared with thousands currently required to monitor their supply chains.
• Companies would only be required to assess direct suppliers rather than full value chains and would receive an extra year to transpose the directive into national law.
• The shifts form part of the European Commission’s Competitiveness Compass agenda to reduce regulatory burdens and boost economic growth.
• Environmental groups and legal experts warn that loosening due diligence checks could undermine climate transparency, erode human rights safeguards and trigger legal challenges.