Supply Chain Due Diligence

Since January 1, 2023, this act will apply to German companies and groups of companies with over 3000 employees, as well as German branches of foreign companies of the same size.

By January 1, 2024, the act will also apply to German companies and groups of companies with over 1000 employees. The act requires these companies to comply with human rights and environmental standards in their supply chains and exposes them to potential liability.

Enforcement of the law will be handled by the Federal Office for Economic Affairs and Export Control (BAFA). BAFA will review reports, investigate complaints, impose measures on companies, and impose fines and exclusion from public contracts. The law might have an indirect effect on companies that are part of the supply chain of German companies. The European Union is also planning on a similar law, which will apply to European companies of a certain size.

The Delegation in Ghana has therefore developed training materials for companies in Ghana that might be indirectly affected by this development, especially if they are supplying products and services to German businesses. The training has been piloted in the Shea supply chain and can be expanded to other sectors.

Existing tools and supporting instruments concerning the supply chain due diligence Act

• The CSR Risk Check tool is aimed at companies that are importing from or have production facilities in foreign countries.
• The BHR Navigator aims to help businesses better understand the most common human rights issues that they may encounter - either through their own operations or their supply chain - and how these can be managed.
• The Due Diligence Compass supports companies in implementing the human rights and environmental due diligence processes from the Supply Chain Care Obligations Act (LkSG) step by step.
• The Sustainable Supply Chain Guide offers support along all phases of sustainable supply chain management and provides practical work aids. This allows one to prepare for the requirements of the Supply Chain Care Act.

Supported by: This project is supported by the Business Scouts for Development programme.