Help us make the FRA website better for you!
Take part in a one-to-one session and help us improve the FRA website. It will take about 30 minutes of your time.
A Human Rights Approach to Due Diligence: Reflections on key principles
Search inside this publication
- Executive summary
- Introduction
- 1. Why is mandatory human rights due diligence needed?
-
2. A risk-based approach within human rights due diligence
- 2.1. Business responsibility to respect human rights
- 2.2. Risk-based approach to identification and assessment of adverse impacts
- 2.3. Shared responsibility in implementing due diligence across the chain of activities
- 2.4. Ongoing monitoring in line with a risk-based approach
- 2.5. A risk-based approach to responsible disengagement
- 3. Stakeholder engagement
- 4. Access to effective remedies and civil liability
- 5. Oversight and enforcement
- About this publication
The effective implementation of HRDD hinges on establishing strong enforcement mechanisms such as administrative supervision, criminal sanctions, civil liability and company grievance mechanisms [82]
Caygın Aydın, F., Dicalou, M., Holly, G., and Morris, D., Mandatory human rights due diligence laws: Key design features and practical considerations, Danish Institute for Human Rights, Copenhagen, 2025.
.
The UNGPs set out complementarity [83] United Nations and Shift, ‘Enforcement of Mandatory Due Diligence, Key Design Considerations for Administrative Supervision’, Policy Paper, 2021, p.7;
between administrative supervision and civil liability, which are both an expression of a Member State’s duty to protect. While effective judicial mechanisms remain at the core of ensuring access to remedy [84]
UN Human Rights Council, ‘Guiding Principles on Business and Human Rights: Implementing the United Nations “Protect, Respect and Remedy” framework’, p. 23.
, administrative, legislative and other non-judicial mechanisms play an essential role in complementing and supplementing judicial mechanisms [85]
UNGPs 1,3, 25, 26 and 27 and the commentaries thereon.
. While civil liability provides judicial remedies to individuals or communities for harm suffered due to corporate actions or negligence, administrative oversight focuses on broader regulatory compliance by proactively monitoring companies, applying non-criminal sanctions or corrective orders, investigating suspected cases of corporate abuse, providing guidance on practical application of HRDD, etc.
Pairing a civil liability regime with administrative oversight by a supervisory authority, which can act autonomously and on its own initiative, can help ensure a comprehensive and proactive approach. HRDD laws should not preclude victims from resorting to both types of recourse simultaneously, allowing them to seek different types of remedy.
Mandatory HRDD laws should establish or designate independent supervisory authorities with powers to investigate, enforce and sanction breaches, making them central actors in safeguarding fundamental rights. Their role is particularly important for high-risk sectors and contexts where victims – especially those in vulnerable situations – may lack effective domestic remedies.
A national supervisory authority should at least:
- be of a public nature, independent from the companies or other market interests;
- be free from conflicts of interest and external influence;
- should neither seek nor take instructions from any entity;
- have a separation of monitoring/sanctioning and advisory/educational functions;
- have expertise in business and human rights standards;
- have adequate resources (human and financial); and
-
have powers to carry out the tasks[86]
see CSDDD Recital 75, Articles 24, 25, and United Nations and Shift, ‘Enforcement of Mandatory Due Diligence, Key Design Considerations for Administrative Supervision’, Policy Paper, 2021.
.
Such supervisory authorities would play a crucial role in ensuring compliance with mandatory HRDD by exercising powers to investigate companies, enforce compliance and issue sanctions. They should be able to request information from businesses, conduct investigations, order companies to cease non-compliant activities, impose penalties and adopt interim measures in cases of imminent severe harm. This enforcement framework, combined with supervisory authorities’ ability to act on their own initiative or in response to reported concerns, should enable them to effectively monitor and promote adherence to the mandatory HRDD requirements [87]
see CSDDD Recital 75, Articles 24, 25, and United Nations and Shift, ‘Enforcement of Mandatory Due Diligence, Key Design Considerations for Administrative Supervision’, Policy Paper, 2021.
.
In the EU, the CSDDD introduces an administrative supervision mechanism that creates a structured, EU-wide system for overseeing corporate sustainability practices. It gives these authorities tools to address companies that fail to comply with the obligations imposed by the directive, most importantly a power to impose ‘effective, proportionate and dissuasive’ penalties. [88] see CSDDD Article 24 and 25.
The Court of Justice of the European Union requires Member States to implement enforcement measures that act as a genuine deterrent for future violations, but these measures must also be proportionate to the harm caused and should be assessed in the light of the circumstances of each individual case [89]
Tobler, C., ‘ECJ case law on effective, proportionate and dissuasive remedies’, in: European Commission: Directorate-General for Employment, Social Affairs and Equal Opportunities, Remedies and sanctions in EC non-discrimination law, Publications Office of the European Union, Luxembourg, 2006, pp. 8–16.
Judgment of the Court of 2 August 1993, M. Helen Marshall v Southampton and South-West Hampshire Area Health Authority, C-271/91, ECLI:EU:C:1993:335.
. Similarly, as is the case for EU competition law, they should aim at prevention; therefore they should be high enough to deter illicit activities that otherwise would be profitable if they go unpunished [90]
European Commission, ‘Fines for breaking EU Competition Law’, 2011.
.
From a rights-protection standpoint, strong penalties can incentivise preventive action aimed at avoiding harm in the first place, especially in high-risk supply chains affecting vulnerable groups, namely by serving as a deterrent against unlawful or abusive behaviour, and redress, namely by providing public and official recognition of the wrongdoing and conveying the message that justice is done [91] See footnote 43.
. In the context of EU harmonisation, while the regulatory acts sometimes prescribe core principles and factors for penalty determination, the discretion left to Member States may produce uneven sanctioning practices. The effectiveness of the provisions on penalties will ultimately depend on the supervisory authorities’ powers and resources and their willingness to apply sanctions. Strong penalties can incentivise companies to take more seriously preventive and mitigating actions and invest in tangible solutions before a human rights risk leads to violation, abuse or damage. This is particularly important in high-risk supply chains that affect vulnerable groups.
Supervisory authorities can play an important role in enforcing, supervising and guiding the application of mandatory HRDD. They should be equipped with the requisite mandate, such as the power to conduct investigations into potential non-compliance, including on their own initiative or based on received complaints; require companies to provide information related to their due diligence processes and impacts; conduct inspections and unannounced visits; order companies to take appropriate remedial actions for any harms or risks identified; and impose penalties or corrective measures. Finally, penalties should fulfil three criteria set out in the directive, i.e. effectiveness, proportionality and dissuasiveness.
Member States should ensure that the supervisory authorities they appoint are independent and equipped with the requisite legal mandate and competence and afforded adequate resources to effectively monitor compliance with the regulatory framework, conduct investigations and enforce their decisions.
Thus, if consistent with international standards and equipped with an appropriate mandate, tools and resources and training, supervisory authorities can contribute to changing corporate culture and provide a real avenue for rights holders.