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Business and Human Rights Update
We are witnessing a legal avalanche relating to business and human rights. Our Business and Human Rights Updates will keep you advised of initiatives of relevance to your business. We are also constantly chasing new tools to enable businesses to identify and effectively address potential harm to people and the environment. Ultimately, what protects people (and the planet) is also what best protects businesses.
The European Commission progresses efforts towards a ban on products produced by forced labour ǀ Sustainability Reporting ǀ Climate, Human Rights and the Norwegian Continental Shelf

On 23 May 2022, the EU Commission published a call for evidence, asking for feedback on a legislative initiative effectively banning products produced, extracted or harvested with forced labour on the EU single market.
The initiative is a continuation of the European Commission’s previous communications on combatting forced labour, including President von der Leyen’s state of the union speech on 15 September 2021, the European Commission’s strategy to promote decent work worldwide published on 23 February 2022 and its Guidance on due diligence for EU businesses to address the risk of forced labour in their operations and supply chains.

According to the call for evidence, the aim of the legislation is to “effectively ban the placing on the EU market of products made wholly or in part by forced labour”, whether produced in the EU or elsewhere in the world. It will build on international standards and complement existing legislation such as the proposed Corporate Sustainability Due Diligence Directive. The intention behind the initiative is to introduce a robust and risk-based enforcement framework, to be carried out by member states’ national authorities. The deadline for feedback is 20 June 2022. Indicative timing for a full legislative proposal is Q3 2022.

EFRAG has published draft Sustainability Reporting Standards (ESRS) for consultation
Earlier this spring, The European Financial Reporting Advisory Group (EFRAG) published for consultation its first draft cross-cutting Sustainability Reporting Standards. The basis for the new standards is found in the proposed Corporate Sustainability Reporting Directive (CSRD), published by the European Commission on 21 April 2021, and subsequently discussed by this Update. For the purpose of this Update, it can be noted that EFRAG proposes reporting obligations covering broad aspects of a company’s value chain: from its own workforce and workers in the value chain, to consumers, end-users, and affected communities.

The deadline for submitting comments is 8 August 2022. Draft sector-specific standards are expected to be published later this year.

Towards global sustainability reporting standards
On 18 May 2022, the IFRS Foundation’s International Sustainability Standards Board (ISSB) outlined its efforts to achieve global core elements of sustainability reporting. The initiative includes a cooperation with the Global Reporting Initiative (GRI), whose new global sustainability reporting standards, applicable as of 1 January 2023, are aligned with the UNGPs and the UN Guiding Principles Reporting Framework. The ISSB’s initiative was well received, including among lawmakers. On 20 May 2022, the G7 Finance Ministers and Central Bank Governors issued a joint statement welcoming the initiative and urging ISSB to cooperate with other initiatives.

Norwegian National Human Rights Institution concludes that the Norwegian government is legally prohibited from approving plans for the production and operation of petroleum fields that are not aligned with the goal of limiting global warming to 1.5 ˚C 
The primary role of the Norwegian National Human Rights Institution (NNHRI) is to promote and protect human rights in accordance with the Constitution, the Norwegian Human Rights Act and other legislation, international treaties and other international law. On 18 March 2022, the NNHRI delivered a legal assessment to the Norwegian Ministry for Petroleum and Energy regarding the thresholds for approving or refusing proposed plans for the production and operation of petroleum fields, based on their climate impact. The NNHRI concluded that the Norwegian government must refuse such plans when the total territorial and exported GHG emissions, that the execution of such plans would give rise to, are not compatible with the goal of limiting global warming to 1.5˚C.

If you have questions or want to discuss any of these issues, you can always reach out to your existing contacts at the firm. You are also welcome to contact the members of our Corporate Sustainability and Risk Management team, some of whom are listed at the bottom of this page. 

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Erica Wiking Häger, Partner, erica.wiking.hager@msa.se
Malin Helgesen, Specialist Counsel, malin.helgesen@msa.se
Peter Linderoth, Partner, peter.linderoth@msa.se
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