Key Takeaways:
After four years of negotiation in the face of sustained corporate lobbying, EU Member States have granted final approval to the Corporate Sustainability Due Diligence Directive (CSDDD) as amended under the Omnibus I legislative package. While the directive establishes a landmark framework for corporate accountability across global supply chains, significant last-minute revisions have weakened its original ambition.
The CSDDD introduces mandatory due diligence obligations for large multinational companies operating in the EU. For the first time in history, companies will be required to identify, prevent, and mitigate human rights abuses and environmental harm across their value chains. It also creates new legal pathways allowing affected parties to seek remedies through EU courts and national enforcement mechanisms. The directive signals a structural shift in how corporate responsibility is regulated within the bloc.
Originally proposed by the European Commission in 2022 and formally adopted in 2024, the CSDDD was reopened earlier this year under Omnibus I. Teresa Anjinho, the EU Ombudswoman, has since criticized aspects of the commission’s handling of the legislative process.
Amendments introduced through the Omnibus I package have narrowed the scope of certain climate and environmental provisions, raising concerns among sustainability advocates that key protections have been diluted. Critics of these revisions argue that they reflect mounting commercial pressure as European policymakers try to balance competitiveness concerns with regulatory oversight.
Nele Meyer, Director of the European Coalition for Corporate Justice, expressed her disappointment in a statement: “Unfortunately, significant amendments to the law introduced as a result of an aggressive and highly coordinated lobbying campaign driven by a handful of powerful multinational corporations have stripped out key climate, environmental, and human rights protections from the final text.”
For the beauty and personal care sector, an industry deeply embedded in complex global sourcing networks, the directive marks an increased scrutiny of ingredient supply chains, manufacturing partners, and environmental risk exposure. Even in its revised form, the CSDDD raises the compliance bar for transparency and traceability, particularly for multinational groups with vertically fragmented operations.
The directive now enters a transposition phase, with Member States required to integrate its provisions into national law by July 2028. The effectiveness of the framework will ultimately depend on how rigorously national governments implement and enforce its requirements.
For brands operating in or exporting to the EU, supply chain accountability is no longer voluntary, but the regulatory landscape remains fluid. Strategic preparation will define which companies successfully navigate this next phase of sustainability governance.