Following the November 13 plenary vote in the European Parliament, the Corporate Sustainability Due Diligence Directive (CSDDD) remains unchanged in one of its most consequential areas: its broad extraterritorial reach. Despite months of engagement and warnings from governments, industry, and economic experts, the Directive still imposes far-reaching administrative and operational burdens on companies operating in or selling into the EU, regardless of where they are headquartered.
As we have discussed, these provisions will require businesses to shoulder significant new compliance costs, build extensive reporting systems across global supply and operating chains, and assume legal exposure extending well beyond EU borders. The result is a framework that creates substantial risk of litigation, operational disruption, and a chilling effect on investment particularly for U.S. businesses, including manufacturers, franchise operations, and the SMEs in supply chains that lack the resources to comply with such obligations.
As our work and communications have consistently emphasized that today’s vote underscores the urgency of continued coordinated messaging. Efforts with U.S. policymakers and EU institutions will be needed to ensure these concerns remain front and center, and hopefully changes are made, as the Directive moves toward final implementation.
