According to experts, the rules currently being discussed at EU level to protect human rights when dealing with foreign trading partners should not entail too much effort for companies. This is what the Scientific Advisory Board of the Federal Ministry of Economics points out in a report on so-called supply chain laws presented in Berlin on Wednesday.
“The Advisory Board sees the danger that companies could withdraw entirely from problematic supplier countries if compliance with the due diligence obligations causes high costs,” explained economist Klaus Schmidt from Munich’s Ludwig Maximilian University, who is the chairman of the committee. “In this case, the desired improvement for human and labor rights would not be achieved.” According to the panel, there is then a risk that supply chains will shift and working conditions will become less controllable.
The Advisory Board consists of 41 professors. The scientists from the field of economics prepare expert opinions on self-chosen topics on a voluntary basis.
In order to avoid excessive effort for companies, the consultants suggest working with lists. Countries in which there are standards for human and labor rights that the state can also enforce would see little need for action. The EU could draw up such a list. Companies should also be sorted into positive and negative lists if they operate in countries whose legal systems are less reliable. From the point of view of the scientists, an examination of whether a company accepts human rights would then only be necessary for companies that operate in non-safe supplier countries and are neither on a positive nor on a negative list.
According to the experts, more far-reaching goals, such as improving working conditions, minimum ecological standards or animal welfare, should not be enforced via supply chain laws. It would be presumptuous for the EU to dictate its standards and values to all other countries, so the argument goes. Fair trade, eco or animal welfare labels are preferable.
The German supply chain law on compliance with human rights, which was passed last year, will apply from 2023. This means that larger companies are obliged to react to grievances when buying products and parts from abroad and to take remedial action if they become aware of them. Environmental destruction is also covered by the law, but only if it is accompanied by human suffering or corruption.
In February, the EU Commission made proposals for a European supply chain law that could be more far-reaching than the German regulations. It is currently being discussed in the European Parliament and between the EU states. (dpa)