The Human Rights Ombudsman (Ombudsman), in its role as a national human rights institution, is committed to the protection and promotion of human rights in all areas, including within the economy. In this light, it has long advocated for effective legislation in the field of corporate governance, which will ensure the protection of human rights and the environment, as well as transparent and responsible business operations.

In 2024, the Ombudsman welcomed the adoption of the European Union's Corporate Sustainability Due Diligence Directive (CSDDD)^[1] and, before that, the European Union's Corporate Sustainability Reporting Directive (CSRD)^[2]. Both directives were recognised at European Union (EU) level as a major milestone in ensuring transparency, accountability and promoting sustainable business practices, and represent a crucial step towards greater respect for human rights and the environment by businesses.

Following the presentation of the new Omnibus legislative proposal of the European Commission regarding simplifications in the field of corporate sustainability reporting and due diligence in companies regarding sustainability (the so-called Omnibus I package)^[3] the Ombudsman took a critical position, which it informed the competent Ministry of the Economy, Tourism and Sport (MGTŠ) about in March this year, sent to the Government of the Republic of Slovenia for information, and informed the Slovenian Members of the European Parliament about it. At that time, the Ombudsman assessed that the proposed changes significantly weaken some key elements of the already adopted CSDDD and CSRD directives and represent a major step back from the already established international consensus regarding the responsibility of companies in the field of human rights and the environment. The proposals of the European Commission in the Omnibus I legislative package are largely inadequate and disproportionate, and harmful to the areas of human rights and the environment.

As the final and crucial phase of negotiations within the framework of the EU institutions' trilogue in Brussels begins, the Ombudsman, together with the umbrella European Network of National Human Rights Institutions (ENNHRI), which represents more than 50 national human rights institutions across Europe, once again draws attention to the main shortcomings of the legislative proposals within the Omnibus I package. Below, we highlight the main recommendations from the ENNHRI joint statement, which is addressed to all decision-makers within the framework of the EU institutions' trilogue:

1. Alignment with international standards and good practice: European co-legislators should commit to adopting an approach to due diligence that is aligned with existing international instruments and good practices of economic operators.

2. Scope: The scope of entities covered by the CSDDD and CSRD should be as broad as possible in order to encourage companies to fulfil their responsibility to respect human rights.

3. Risk-based approach to due diligence: The approach in the CSDDD should be aligned as much as possible with the UN Guiding Principles on Business (UNGP) and the OECD Guidelines for Multinational Enterprises. These are internationally recognised standards that require companies to take a realistic and risk-based approach. This is the most appropriate way for companies to effectively identify and address impacts on people and the environment and avoid unnecessary administrative burdens resulting from fragmentation and duplication of processes.

4. Limitations in the name of reducing bureaucratic burdens: The CSDDD should be based on due diligence based on identifying and addressing risks. This necessarily includes access to relevant data, including the possibility of requesting information from business partners. It is not about additional bureaucratic burdens, but about the efficiency of such procedures. A pragmatic approach is needed that allows for cooperation with business partners, as this is the only way for companies to carry out risk-based due diligence in line with the UNGP and the OECD Guidelines.

5. Stakeholder engagement: Stakeholder engagement should remain a central element of the due diligence process in CSDDD, and the broad definition of stakeholders, which also includes national human rights institutions, should be maintained.

6. Civil liability and access to justice: The original provisions on civil liability in the CSDDD should be maintained with the aim of ensuring uniformity and coherence across the EU. It should also restore the mandatory overriding application of the provisions (under the CSDDD, Member States must make the civil liability rules of the Directive mandatory overriding application) and ensure that the elements of access to justice allow for effective access to a remedy for rightsholders.

7. Climate transition plans: The obligation to adopt and implement climate transition plans should be maintained in the CSDDD.

8. European Sustainability Reporting Standards (ESRS) and sectoral standards: The ESRS standards should be implemented in a way that allows for simplification but without compromising the integrity of the standards, including in relation to social sustainability and human rights. The CSRD should maintain the requirement to adopt sectoral standards or guidelines.

The Ombudsman recalls that the protection of the environment and human rights is a prerequisite for a safe and stable economic environment and sustainable development that benefits everyone – businesses, employees, communities, and future generations.