Dark
Light

International news monitoring: Corporate duty of vigilance

A sample of Newsendip’s capacity in international news monitoring and analysis for a corporate duty of vigilance.

Risks of human rights allegations from Chinese suppliers for German car manufacturers

Volkswagen is considering reorganizing its activities in the Chinese region of Xinjiang in the context of reports of possible human rights violations. “The Volkswagen Group is currently in talks with the uncontrolled joint venture Saic-Volkswagen about the future direction of business activities in the Xinjiang province,” a company spokesman told German news agency dpa on February 14.

According to information from WirtschaftsWoche, Manfred Döss, Volkswagen Board Member for Legal Affairs and Compliance, concluded in May 2023 that cobalt processing in China was associated with “high human rights risks.” Cobalt is critical for electric vehicles. The United States seized Volkswagen models at the border because of suspicions of human rights violations by Chinese suppliers but has now also targeted BMW cars, indicating it is probably only a start.

The German company Volkswagen falls under the scope of the newly adopted German Supply Chain Act (Lieferkettensorgfaltspflichtengesetz or LkSG). Therefore, it is legally bound to fulfill the due diligence obligations as stated in the law (cf. §3), including taking remedial measures, according to its §7. Remedial measures should be taken if a company identifies a human rights or environmental risk in its own business area or at a direct supplier in the course of the risk analysis carried out in accordance with § 5 of the Act that has already occurred or is about to occur in its own business area or at a direct supplier. The company is obliged to prevent or terminate this violation or minimize its extent. According to the law, and under certain circumstances, the business relationship should be terminated as an ultimate recourse.

Legal background: The German company Volkswagen falls under the scope of the newly adopted German Supply Chain Act (“Lieferkettensorgfaltspflichtengesetz” or LkSG). Therefore, it is legally bound to fulfill the due diligence obligations as stated in the law (cf. §3), including taking remedial measures, according to its §7. Remedial measures should be taken if a company identifies a human rights or environmental risk in its own business area or at a direct supplier in the course of the risk analysis carried out in accordance with § 5 of the Act that has already occurred or is about to occur in its own business area or at a direct supplier. The company is obliged to prevent or terminate this violation or minimize its extent. According to the law, and under certain circumstances, the business relationship should be terminated as an ultimate recourse.

The situation in the United States refers to the obligations under the Uyghur Forced Labor Prevention Act (UFLPA). In the U.S., it is illegal to import ‘goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part’ by forced labor. Such merchandise is subject to exclusion or seizure and may lead to the criminal investigation of the importer.


BASF rejects allegations following an open letter from politicians

Following allegations against a partner company in China and a letter from politicians, the German chemical company BASF has emphasized that it is ensuring that business partners respect human rights. Two members of the Bundestag called on the company to reconsider its commitment to China or to stop it completely. Deutschlandfunk


UK: Severn waste worker loses age discrimination case

Severn Waste Services (SWS) did not unlawfully discriminate against a 66-year-old employee by offering him a chair and moving him from one working line to another.


Austria: Handling discrimination and harassment

Austrian Science Fund, FWF, has released guidelines on fostering a diverse research culture that includes practical advice on handling discrimination and harassment.


Child labor in tobacco production

British American Tobacco responded to human rights violation allegations and released its latest plan on human rights and child labor in tobacco growing.


A focus on the phases of due diligence :

One of the six phases of Human rights and environmental due diligence consists of preventing potential impacts and, if possible, ending actual impacts. As such, companies are required to seek contractual assurances from their direct business partners ascertaining that they comply with the company’s code of conduct and that they seek the same assurance from their business partners (the so-called contractual cascading). Such assurances, which can be inserted into the contracts, are to be accompanied by appropriate measures to verify compliance.

Want to get more info and analysis tailored to your needs?