Socially responsible production obligatory in Germany

In 2021, a German duty of care law on supply chains came into force, which will make socially responsible production obligatory. This also applies to food and other products in the agri-food sector, and applies to both the producer and the direct and indirect suppliers in the product chain. From farm to fork.

With this law on duty of care in the supply chain, the German government is responding to a longer ongoing discussion at EU level to better protect human rights along supply chains. This concerns child labour, for example, but also indirect health effects as a result of air or water pollution.

Policy

The legislation applies to all companies based in Germany (even if they are a subsidiary of a company outside Germany). Important elements are risk analysis by the companies, a prevention plan and a protocol for handling complaints. If violations are suspected at direct or indirect suppliers, there is an obligation to inspect. If a violation is established, the company must initiate the resolution of the problem. Companies must communicate transparently about the implementation of their own policy.

First reactions

The new legislation will enter a phased-in approach: from 1 January 2023, companies with more than 3,000 FTEs in Germany will have to comply with the new rules, and from 1 January 2024, companies with 1,000 FTEs or more will also have to comply. The legislation will be evaluated before it is extended to smaller companies. The first reactions from the German business world show above all that complying with the legislation can be far-reaching. They often seek help from external expertise, especially from corporate law specialists and the big consulting firms. German companies can also make use of the (free) services offered by government agencies and various sector organisations.

Agroberichtenbuitenland.nl