Calls grow for laws requiring firms to reveal links to deforestation

Bibi van der Zee, Alexandra Heal and Andrew Wasley
Photograph: Joedson Alves/EPA

There is growing support in the UK and Europe for laws that would make due diligence on issues such as deforestation and human rights abuses mandatory for large businesses.

NGOs have been pushing for regulatory action for at least a decade. But this year governments and, more surprisingly, the private sector have swung behind the cause.

France introduced a law on duty of diligence in 2017 which places a civil liability on large businesses that fail to monitor and prevent human rights and environmental abuses in their supply chain. The first case is currently going through the courts and is being closely watched.

Due diligence laws – in subtly varying forms and covering different issues – have also been introduced or are pending in Norway, the UK, the Netherlands, Switzerland, Finland and Germany. The Liberal Democrats in the UK have backed due diligence reporting in their manifesto for the current election.

In July the European commission set out the case for protecting forests and warned that “EU consumption of food and feed products is among the main drivers of environmental impacts, creating high pressure on forests in non-EU countries and accelerating deforestation.” It is currently considering mandatory due diligence as one of a number of measures for curbing deforestation. Other options include labelling. “But I think most of us feel we are way past that point,” said Julia Christian of the NGO Fern.

Related: UK firms urge Brazil to stop Amazon deforestation for soy production

Dr Chris West, who works on supply chains for the Stockholm Environment Institute at the University of York, said: “Research shows a growing awareness from the public that problems such as deforestation, pollution [and] child labour may be at the roots of the food that we eat, our furniture, our transport. But it’s still very difficult for consumers or even companies to assess which products are most damaging.”

Following a Guardian investigation into deforestation in Brazil, MEPs are also demanding action.

“It cannot be the responsibility of a consumer to ensure that the products on European markets’ shelves are sustainably produced,” MEP Heidi Hautala told the Guardian. “The consumer has to be able to trust that only responsibly produced items are sold in Europe.”

Meanwhile, the private sector is surprisingly keen to support regulation. “It’s a real change from the past,” said Christian, “where industry would be very resistant to change. Now some of the biggest companies are actively seeking it.”

Both Mondelēz International and Mars said earlier this year that they believed legislation was inevitable and Nestlé has given its support to their call for regulation.

MEPs are also demanding that the commission looks again at EU trade deals.

“We need to change the rules with an international binding treaty forcing transnational companies to pay the price if they destroy the environment,” said French MEP Manon Aubry, demanding a rethink on the trade deal between the EU and South America’s Mercosur bloc which, if ratified, would open the gates to reduced-tariff beef imports from Brazil and other countries.

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“The EU also has to question the impact of free trade agreements that are detrimental to both the planet and the people,” said Aubry. “A deal with Mercosur would worsen the situation and accelerate deforestation in Amazonia.”

The Austrian government recently blocked the deal over concerns about the Amazon fires crisis – as well as the potential damage to Austria’s farming sector – and the French and Irish governments have threatened to do the same.

Jo Blackman, head of forests policy and advocacy at Global Witness, told the Guardian: “It’s clear that voluntary initiatives are failing – and it’s now time for governments to act and require companies and financial institutions to undertake due diligence to identify, mitigate and prevent risks of environmental harm.”

Phil Bloomer, head of the Business and Human Rights Resource Centre, said: “A legal duty of care and protection of people’s rights and the environment is now proposed by enlightened companies, investors, parliamentarians and governments, alongside activists. There is a growing consensus that business-as-usual is now an existential threat to our way of life and planet. These laws will help lift minimum corporate behaviour.”