BMW is accused of not sufficiently complying with environmental standards. Oxfam is also lodging a complaint against REWE and Edeka for violating human rights.
Premises for compliance with human rights standards and environmental rights are becoming more and more prevalent, as not only the supply chain act has its focus of application here, but also the complex field of ESG and the upcoming CSRD will keep these areas up to date.
What is the connection between the supply chain act and ESG?
Social responsibility: Both areas emphasize the importance of corporate social responsibility. The Supply Chain Act requires companies to monitor and prevent human rights violations and environmental impacts in their global supply chains. ESG criteria also assess a company's social responsibility, including labor practices, human rights and community relations.
Environmental impacts: Both the Supply Chain Act and the ESG topic take environmental impacts into account. The Supply Chain Act focuses on the environmental consequences in global supply chains, while ESG assesses environmental aspects such as the ecological footprint, energy consumption and environmental protection measures within the company.
Governance: ESG attaches great importance to sustainable and responsible corporate governance. In line with this is compliance with the requirements of the Supply Chain Act, which helps the management to monitor its value chains more closely and improve the sustainability of its suppliers in the long term.
Why is it crucial for companies to consider the supply chain act and ESG in an overall context?
Companies that want to grow responsibly and sustainably must recognize that sustainable business practices and social responsibility must be an integral part of their corporate strategy.
This is because by incorporating ESG factors into corporate decision-making processes, organizations tend to be better prepared for environmental and social risks and better able to build long-term trust with shareholders and other stakeholders. DFurthermore, social responsibility can promote the positive image of the organization, while good Governance can strengthen transparency and accountability.
In addition, long-term risks can be minimized by taking ESG factors into account. By focusing on other environmental aspects, efficiency can be increased, costs can be reduced and positive environmental effects can be achieved at the same time.
Overall, the connection between the supply chain act and ESG shows that the integration of sustainability and ethical principles into business strategy is not only morally correct, but also makes economic sense in the long term. Organizations that take a balanced approach between long-term value creation and ESG factors are better positioned to meet the challenges of the future and promote sustainable growth.
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Project Manager Sales
Referentin Lieferkettenrecht
Legal Compliance Expert
