FIT for FAIR

Agricultural supply chains secure the livelihoods of billions of people. However, the cultivation of crops, their processing and the trade in them often lead to considerable environmental, economic and social damage. These negative impacts - e.g. deforestation due to the expansion of agriculture, child labor, poor working conditions and low wages and incomes - are frequently observed in the producing countries. To address these impacts, many countries have enacted laws that require companies to consider social and environmental risks as part of due diligence in their business activities. At EU level, the European Supply Chain Directive (CSDDD) will oblige companies to carry out due diligence with regard to social and environmental risks. In addition, the EU regulation on deforestation-free products (EUDR) will require companies to exercise due diligence to ensure that relevant agricultural and timber products are produced without deforestation and in compliance with relevant climate and biodiversity protection laws. Germany has adopted the Supply Chain Due Diligence Act (LkSG), which came into force in January 2023. The LkSG aims to protect fundamental human rights in companies' supply chains and focuses in particular on the prohibition of child and forced labor. Against this backdrop, the German Federal Ministry for Economic Cooperation and Development (BMZ) has commissioned the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH to support selected partner countries in adapting to the increased due diligence requirements.