Europe in practice: companies liable for the production chain, even far outside the EU

Next Thursday, the Netherlands will elect new members of the European Parliament. There will soon be 31 people on behalf of the Netherlands in the European parliament. What has parliament decided in recent years? In a series of five articles we zoom in on how the European Parliament touches our lives. Today: the anti-looking away law for large companies.

This law has been negotiated for years. Its full name is the Corporate Sustainability Due Diligence Directive, and it boils down to this: large companies are responsible for people and the environment throughout their entire supply chain. They need to know what is happening there, and they must take action against child labor, deforestation, forced labor and poor working conditions, among other things.

European Parliamentarian Lara Wolters (PvdA) played a major role in the development of the law. In the debate in parliament she said: “We are making a fundamental choice: do we accept that people on the other side of the world make our T-shirts under unsafe conditions and for a few euros a day?”

This is how it works

The law will apply to companies with more than a thousand employees and a turnover above 450 million euros. A large textile company will soon no longer be able to say that it knows nothing about poor working conditions in a subcontractor’s sewing workshop. Chocolate brands must ensure that no slave labor takes place on the plantations where their cocoa beans come from.

The big advantage, according to Wolters, is that the agreements are not without obligation. “If you could or should have known that something was wrong, and you did nothing about it, you could be taken to court or receive a fine.”

In practice

Some companies are already working on better supervision in their chain. Textile company Zeeman does this voluntarily. The enormous distribution center in Alphen aan de Rijn receives boxes of clothes from China, Turkey, Pakistan, Bangladesh and India.

Bo Duijvestijn travels to those countries for Zeeman to visit the factories. She pays attention to, among other things, the safety of employees. If there are any abuses, employees can report them anonymously.

Zeeman wants, among other things, that employees receive a living wage. “They are paid the minimum wage in all those countries,” says Duijvestijn, “but that is sometimes too little to live on. That is why we want them to receive a living wage.”

The European rules are about much more, says Corporate Social Responsibility manager Arnoud van Vliet. Working conditions are a particular concern in the textile sector. “The greatest risks now are at cotton plantations and spinning mills. It is difficult to know exactly what is happening in all those distant countries. But we also have local partners who check there for us.”

Zeeman wants to be at the forefront in this area and European legislation will help with this, says Van Vliet. “This is going to help us speed up, because it will be mandatory for everyone.”

His colleague Duijvestijn adds: “Now you actually see that every brand asks factories something different. We are often the first with demands, it helps enormously if we are no longer alone.”

There have been many intentions, covenants and resolutions in the textile industry before. But now they become obligations. “The good thing about that is that you get a level playing field,” says Van Vliet. “It will be fairer and more transparent”.

Small companies are not covered by European legislation, but they too will work differently, he thinks. “We will also place the obligations we have on smaller companies from which we purchase, and this will create a chain reaction.”

Hard-fought

The law did not come by itself. There was hard lobbying against it until the last moment by large companies, who wanted sanctions to disappear from the legal text. “I have never experienced anything like this in Brussels,” says MEP Wolters. “The mood was really tense. I sometimes wondered: can’t we even get together in Europe for a law against child labor and deforestation?! But we succeeded.”

As a result of the law, some products may become slightly more expensive. According to Wolters, that should not be a problem. “If we pay a few cents more so that someone on the other side of the world is paid a living wage, then it is well worth it,” she says.

Bo Duijvestijn from Zeeman thinks so too. “We must clearly explain to consumers what has improved in the chain, why it is a fairer price.”