Skip to content
csddd banner retraced

Understand the Corporate Sustainability Due Diligence Directive (CSDDD) and Stay Compliant

The CSDDD aims to promote responsible corporate behavior by requiring companies to identify and mitigate harmful human rights and environmental impacts in their operations and value chains. Be compliant with Retraced.

Tom Tailor corporate logo
Alife Kickin corporate Logo
Desigual corporate logo.
Loffler corporate logo
Calzedonia corporate logo
Victorias Secret corporate logo
Brownie corporate logo
Vaude corporate logo
Galeria corporate logo
Marc O Polo corporate logo
What is csddd - retraced

What is the CSDDD?

The CSDDD is in force since July 25th, 2024. Companies subject to the new directive must conduct due diligence on environmental and human rights issues, while also adopting a transition plan to address climate change mitigation.

These obligations apply not only to a company’s direct operations but also to their subsidiaries and broader value chains, both upstream and downstream

CONTACT OUR SALES TEAM
csddd affect - retraced

How Will CSDDD Affect EU and Non-EU Companies?

The Corporate Sustainability Due Diligence Directive (CSDDD) will impact around 6,000 EU-based companies and 900 non-EU companies. For EU companies, this includes those with over 1,000 employees and a net global turnover exceeding €450 million. Non-EU companies must meet the same turnover threshold within the EU to fall under the scope.

Additionally, companies engaged in franchising or licensing agreements with a net turnover exceeding €80 million, and generating more than €22.5 million through royalties, will also be affected.

The implementation of the Corporate Sustainability Due Diligence Directive will be phased between groups - from biggest to smallest scope - from 2027 until 2029.

What Do You Need to Become CSDDD Compliant?

Due Diligence - CSDDD

Due Diligence Policy:

Policy on company’s approach to Due Diligence, including a code of conduct for company and, where relevant, business partners (a Guidance document will be provided by the Commission, which will likely clarify open points such as this).

Risk Assesment - CSDDD

Risk Assessment:

Start with a solid supply chain mapping, knowing where business partners are placed in terms of risks, country and industry-wise.

Following that, assessing severity and likelihood of potential harmful impacts ensures the right factors for risk prioritization.

Risk Prioritization-  CSDDD

Risk Prioritization:

Prioritize harmful impacts based on their severity and likelihood, focusing on those that are most severe or likely to occur.

Preventive Measures - CSDDD

Preventive Measures:

Develop and document action plans aimed to prevent and mitigate risks, having contractual assurances (establishing human rights and environmental expected standards), keeping records of supplier audits, support SMEs in the value chain (avoiding overburden and promoting meaningful engagement), etc.

Remedial - CSDDD

Remedial Measures:

Cease/minimize impacts through a corrective plan.

Provide remediation and adapt company’s strategy if needed, keeping record of any remediation steps taken (for example, corrective measures and monetary compensation).

Stake Holder - engagement

Stakeholder Engagement:

This means consulting potentially affected communities, business partners in the value chain, peers from similar industries, participation in multilevel initiatives and dialogues with NGOs and similar organizations.

Grievance - CSDDD

Grievance Mechanism:

Establish an accessible, fair and transparent procedure for handling complaints (with confidentiality and no retaliation assured).

The mechanism should be informed and accessible to any person interested in reporting a grievance, regardless of the stage of the value chain.

Monitoring - CSDDD

Regular Monitoring:

Conduct assessments at least yearly or ad-hoc to evaluate effectiveness of measures & policies.

Communicating - CSDDD

Communicating:

Reporting obligation can be fulfilled through the Corporate Sustainability Reporting Directive (CSRD).

Commission will set detailed criteria by 2027 on the reporting requirements, which also largely depends of the transposition of the Directive into national law by Member States (due to happen by July 2026).

Transition - CSDDD

Transition Plan:

Climate Change Companies must adopt a transition plan for climate change mitigation, aligned with the Paris Agreement and set climate neutrality targets. The Transition Plan is not part of the Due Diligence set by the Directive, but it’s one of the major requirements of it.

How Can Retraced Support You to Be CSDDD Compliant?

How Can You Become and Stay Compliant with CSDDD?

Step-by-Step to Better Corporate Sustainability Due Diligence

Apart from CSDDD, the fashion and textile industries are facing many laws & regulations. Some are already in place; others are expected to come into effect within a few years.

The Retraced guide below helps companies like yours to holistically tackle all current and upcoming corporate sustainability due diligence regulations. Note that while the guide has six steps, the last one leads back to the first step. In an ever-evolving regulatory landscape fashion brands will never be done, just ready for the next iteration.

Set Goals - CSDDD
1. Set Due Diligence Goals

Define goals aligned with your company’s obligations under the CSDDD.

Ensure a focus on human rights and environmental impacts to comply with legal requirements.

Identify key stakeholders like consumers and retailers, and understand their impact.

Map Supply LKSG
2. Map and Assess Your Supply Chain

Identify and trace business partners across different regions, including EU and non-EU companies.

Explore your network, identify and connect all relevant stakeholders, and map them down to the source of your raw materials.

Trace and verify all your supply chain steps for your different products and orders.

Request and manage proof and transaction records to ensure transparency and compliance.

Collect Data - CSDDD
3. Collect Relevant Data

Collect necessary information, certificates, and data from suppliers to meet the CSDDD’s risk evaluation and due diligence obligations.

Companies must adopt a secure, transparent system to ensure compliance and provide evidence of sustainable practices.

Conduct Risk Assesment - CSDDD
4. Conduct Risk Assessments

Identify potential risks, pinpoint areas for improvement, and uncover information gaps.

Define different supplier requirement catalogues, and identify global risk factors based on OECD classifications of various indexes (ITUC, GRI, GSI, etc.).

Prioritize your mitigation efforts with clear, comprehensive, and fully automated risk profile overviews for each company in your network.

Keep track of all actions and implications of your sustainability management in your compliance dashboard.

Preventive Remedial - CSDDD
5. Implement Preventive and Remedial Actions

Establish clear actions to be executed in response to the insights gained from the data gathered.

List and assign all tasks that can positively transform your supply chain to achieve compliance with the different laws and regulations in place.

Collaborate with the different departments within your company and with your suppliers to enable sustainability goals setting.

Successfully implement thorough HRDD processes across your operations.

Disclose - CSDDD
6. Disclose How You Comply with Due Diligence Policies

Share your discoveries and initiatives aimed at enhancing responsible practices with internal and external stakeholders.

Provide information and communicate your transparency and sustainability efforts to your clients via QR codes.

Report your compliance to relevant stakeholders (NGOs, government, or clients) and minimize your compliance risks.

Build trust among clients through your commitment and impact to increase the value of your supply chain and final products.

LEARN MORE ABOUT OUR PLATFORM

Why Choose Retraced for Your CSDDD Compliance?

Start your journey towards CSDDD compliance with Retraced and make responsible business practices a core part of your supply chain strategy.

Transparency - CSDDD
End-to-End Supply Chain Transparency

Gain complete visibility into your supply chain with real-time data collection and automated due diligence processes.

Risk Assesment - CSDDD
Seamless Risk Assessment & Compliance Monitoring

Identify, assess, and mitigate risks related to human rights and environmental impacts, ensuring compliance with the latest CSDDD standards.

Automated Reporting - CSDDD
Automated Reporting & Documentation

Effortlessly generate audit-ready reports to meet regulatory requirements, backed by verified supply chain data.

Collaboration Blue - CSDDDD
Supplier Collaboration & Engagement

Work closely with your suppliers through a secure platform, ensuring continuous improvement in sustainability practices.

Compliance - CSDDD
Future-Proof Your Business

With evolving regulations, Retraced helps you stay compliant today and prepared for tomorrow.

Unlock the Potential of Your Business with Retraced

Explore how our end-to-end solutions can address your unique challenges, backed by our team of experienced professionals.

Trusted by

Galeria corporate logo
Strellson corporate logo
Tom Tailor corporate logo.
Marc O Polo corporate logo
S Oliver Group corporate logo
Manage due diligence - csddd

Reach Supply Chain Transparency with Retraced

Book your demo