Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/283509 
Year of Publication: 
2024
Series/Report no.: 
WIFO Working Papers No. 669
Publisher: 
Austrian Institute of Economic Research (WIFO), Vienna
Abstract: 
The EU Directive on Corporate Sustainable Due Diligence has sparked fierce debate about the regulations of supply chains. The Directive's objectives are aligned with European values. Assuming that enforcements of social and environmental rules are absent in certain third countries, it privatises compliance costs in complex supply networks. This paper suggests options to make the Directive more effective and efficient. It should exclude countries with a sufficient regulatory system and focus not on the entire network but on supplier-buyer relationships only. Public agencies should set harmonised regulatory standards, interpret the regulations and organise a private certification scheme in which liabilities are assumed by certification companies. The proposed system resembles the market for financial auditors.
Subjects: 
EU
supply chain
due diligence
regulation
firm
international trade
JEL: 
F13
F18
J80
Document Type: 
Working Paper

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