ESG and sustainability due diligence is a risk mitigation strategy for companies. It refers to the process of identifying, assessing, and managing risks relating to human rights, labor standards, and environmental protection arising from a company’s own operations and the operations of its subsidiaries and business partners in its supply chain.
Robust due diligence is integrated into corporate policies, reflected in transparent procedures with appropriate governance and grievance mechanisms, and is implemented across operational parts of the business. Building on international instruments, ESG and sustainability due diligence is increasingly required by law in some jurisdictions; it may be important for companies in order to remain competitive in public tender procedures; and is an important tool to mitigate the growing ESG and sustainability reputational and litigation risks that companies face.
Our Work
With lawyers in the United States, Europe, and Asia-Pacific, Sidley’s ESG and sustainability team have deep cross-jurisdictional experience on ESG and sustainability due diligence, from high-level strategic questions to the detailed “nuts and bolts” issues our clients face day-to-day.
Specifically, we routinely advise clients on due diligence requirements under the EU’s Corporate Sustainability Due Diligence Directive (CS3D), Batteries Regulation, Deforestation Regulation, and Anti-Forced Labour Regulation (AFLR); Germany’s Supply Chain Due Diligence Act; Norway’s Transparency Act; the UK’s Modern Slavery Act; Switzerland’s Child Labour Law; as well as the U.S. Uyghur Forced Labor Prevention Act; and the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct.
Our work under these various laws and instruments involves:
- Assisting with developing and implementing a cross-jurisdictional due diligence strategy.
- Building, reviewing, and implementing the different components of due diligence policies and procedures.
- Advising on stakeholder engagement, supplier onboarding procedures, and related contractual arrangements.
- Reviewing mandatory disclosures on due diligence activities.
- Assessing and mitigating legal risks relating to human rights, labor standards, and environmental protection across jurisdictions.
- Developing and delivering due diligence training for companies and their suppliers.
- Conducting ESG and sustainability due diligence in M&A transactions.
