Swedish Companies Urge Government to Prioritize Due Diligence in Finance Bill

Introduction

A group of prominent Swedish companies has sent a joint letter to the government urging them to ensure that the Corporate Sustainability Due Diligence Directive (CSDDD) is aligned with international frameworks and standards.

The Importance of Aligned Definitions and Principles

The directive aims to promote corporate responsibility and mitigate negative impacts on human rights and the environment. However, the signatory companies warn that any deviation from established definitions and principles could lead to unnecessary administrative burdens and confusion.

“We urge the government to prioritize the use of established definitions and base the requirements on existing frameworks,” said Arvid Nordquist, CEO of Axfood, one of the signing companies. “Companies are already actively working in accordance with the UN Guiding Principles and OECD Guidelines, and we should not create our own definitions that could lead to confusion.”

The Need for a Risk-Based Approach

The companies also emphasized the importance of a risk-based approach to due diligence, which prioritizes risks based on severity. This would allow companies to focus their efforts where they can make the most urgent difference.

• Prioritizing risks based on severity
• Focusing efforts on high-risk areas
• Identifying and mitigating negative impacts

Ensuring Transparency and Accountability

The signatory companies stressed the need for the directive to cover the entire value chain, all sectors, and types of companies. They warned that excluding certain sectors or companies could lead to a lack of transparency and accountability.

• Covering the entire value chain
• Including all sectors and types of companies
• Ensuring transparency and accountability

Focusing on Own Activities and Human Rights Impact

The letter also highlighted the importance of ensuring that companies focus on their own activities and how they affect human rights in the value chain. This means analyzing business models, purchasing practices, and sales processes to identify risks and mitigate negative impacts.

• Analyzing business models
• Identifying and mitigating negative impacts
• Focusing on own activities and human rights impact

Accountability Provisions

The companies called for accountability provisions to be based on established concepts of corporate responsibility, including administrative measures and civil liability. This would provide a clear framework for holding companies accountable for their actions.

• Administrative measures
• Civil liability
• Clear framework for accountability

Signatory Companies

The signatory companies include:

• Axfood
• Ericsson
• ICA Sverige
• IKEA (Inter IKEA Group and Ingka Group)
• Lidl Sverige
• Luleå Lokaltrafik
• Menigo Foodservice
• Open Air Group
• Soltech Energy
• Systembolaget
• Telia Company
• Volvo Cars Group

“We urge the Swedish government to pursue these issues in the trilogue process and ensure that the CSDDD becomes an effective directive that supports responsible business, mitigates risks, and strengthens respect for human rights and the environment,” said Nordquist.