Expanding the Toolbox of Sustainable Business Law: The Transnational Impacts of the EU Corporate Sustainability Due Diligence Directive (CSDDD)

The contemporary global economy relies extensively on interconnected value chains that often span different continents, presenting challenges when operations result in human rights violations or environmental damage. This has prompted the emergence of non-binding due diligence guidelines and binding laws in several countries, reflecting the necessity of fostering accountability in transnational business activities. The European Union’s adoption of the Corporate Sustainability Due Diligence Directive (CSDDD) on May 24th, 2024, represents a novel significant milestone in this trajectory. As a new instrument of binding transnational business law, the CSDDD aims to promote sustainable business practices, with implications extending beyond EU borders. This article provides a transatlantic perspective on the CSDDD, exploring its relevance to U.S.-based businesses and its potential to foster sustainability within a global business context. It explores the directive’s personal and material scope, its enforcement mechanisms, and reflects on the broader implications in relation to corporate sustainability.