The Swiss Legislation on Business and Human Rights: A Reform Needed Towards Harmonization with EU Law

Abstract This article examines the disparities between the (existing and planned) business and human rights (BHR) legislations in Switzerland and the European Union (EU). More specifically, (i) the key differences that exist between the Swiss and EU BHR legislations are identified, and (ii) the proposed amendments to the Swiss BHR legislation to reach the desired harmonization with the EU framework are put forward. The Swiss BHR legislation, implemented in stages on 1 January 2021 and 1 January 2023, encompasses provisions related to ‘transparency on non-financial matters’, ‘transparency in raw material companies’, and ‘due diligence and transparency in relation to minerals and metals from conflict-affected areas and child labor’. The EU BHR legal framework, however, has undergone a major overhaul, with the recent adoption of the Corporate Sustainability Reporting Directive (CSRD) and the Directive on Corporate Sustainability Due Diligence (CSDDD) that introduce additional obligations. These EU regulations have (or will have) important extraterritorial effects, including on Swiss undertakings operating—directly or indirectly—in the EU. To prevent Swiss companies from being subject to a diverse array of regulations (with an increased risk of sanctions in case of non-compliance), a reform of the Swiss BHR legislation is needed to ensure harmonization with EU BHR legislation. This article also serves as a resource if full equivalence between them is sought.