Supply chain due diligence: What Swiss companies need to know and do

Since January 1, 2023, all companies in the EU, i.e. including Swiss companies with headquarters or a site in Germany and at least 3,000 employees, must implement human rights and environmental due diligence in their supply chains.

From January 1, 2024, the law will also apply to companies with at least 1,000 employees.

The following also applies to Swiss companies without a location in Germany that supply a company in Germany affected by the law: by supplying to Germany, the Swiss company is part of the supply chain to be monitored by the German company and is therefore also subject to the obligation.

In concrete terms, this means that affected German companies will ask their Swiss suppliers to provide an assurance of their reliability with regard to the requirements of the law.

In practice, the Swiss supplier will therefore primarily have to provide an assurance of its own reliability with regard to the law.

What specific measures must companies take to comply with the due diligence obligations?

The following measures are mandatory for all companies concerned. They therefore also apply to all Swiss companies with a location in Germany and the aforementioned number of employees.

The following must be implemented

The establishment or expansion of a risk management system that also covers sustainability aspects in the supply chain,
the definition of internal company responsibilities,
carrying out regular risk analyses, explaining the procedures for identifying adverse effects on human rights,
establishing preventive measures in the company’s own business area, with direct suppliers and – if there are indications of possible violations – with indirect suppliers,
taking remedial measures in the event of a violation of a protected legal position,
the establishment of a complaints procedure or complaints management,
documentation and annual reporting.

3i Business Solutions AG can support your company with the implementation.