A Human Rights Approach to Due Diligence: Reflections on key principles

This focus paper looks at business’ responsibility to respect human rights and explores the critical importance and benefits of effective human rights due diligence (HRDD) frameworks. It stems from the European Union Agency for Fundamental Rights’ (FRA) ongoing project on fundamental rights in corporate sustainability and due diligence offering preliminary reflections on HRDD that are emerging from the desk research. A key overarching theme of that research and this paper underscores the enduring need to bridge the gap between voluntary international frameworks set out in United Nations Guiding Principles on Business and Human Rights (UNGPs) and Organisation for Economic Co-operation and Development Guidelines for Multinational Enterprises on Responsible Business Conduct (OECD Guidelines), and enforceable legal obligations, such as the Directive (EU) 2024/1760 (the Corporate Sustainability Due Diligence Directive, or CSDDD), to ensure that businesses fulfil their responsibility to respect human rights.

The paper adopts a human-rights-based approach to due diligence and recalls the following foundational elements of an HRDD process.

• The HRDD process should be risk-based and proactive, i.e. focus on preventing and addressing the most severe and the most likely adverse impacts to human rights. Limiting in-depth assessments of impacts to predominantly direct business partners could severely weaken the effectiveness of the due diligence process – it would redirect companies’ limited resources and the focus of the required due diligence away from the lower tiers, where salient adverse impacts occur most often. It could result in severe human rights risks across the value chains remaining unidentified and unaddressed.
• HRDD is an ongoing process: companies must monitor impacts regularly and adjust their processes to ensure that they identify and address adverse human rights impacts in a timely manner.
• Meaningful stakeholder engagement throughout the HRDD process should be ensured, as it helps companies identify risks and develop targeted mitigation measures. Rights holders on the ground can provide valuable insights and propose relevant solutions, building trust and credibility while reducing business risks.
• Establishing clear liability standards and harmonised civil liability regimes across the EU is essential for providing effective access to remedies. It enhances legal certainty for both companies and rights holders by providing clarity on obligations and on the consequences of failing to meet due diligence standards.
• Supervisory authorities play a vital role in guiding and enforcing the application of HRDD. They should be equipped with the necessary mandate and adequate tools and resources to conduct investigations, require information, conduct inspections, order remedial actions and impose penalties. Such penalties should be effective, proportionate and dissuasive, providing a real incentive for companies to invest in preventive measures.
• New and emerging HRDD frameworks, including mandatory HRDD laws, should, as far as possible, align with existing international standards to promote international policy coherence and the highest possible standard of human rights protection in the area of business regulation.