German Bundestag passes new law on supply chain ethics

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Germany’s Bundestag on Friday passed a law requiring companies to report human rights and environmental abuses along their direct supply chains.

The law will go into effect in 2023 for roughly 600 large companies with 3,000 or more employees, and in 2024 for another 3,000 companies with 1,000 or more employees.

German subsidiaries of multinational companies or those with offices in Germany will also be required to report infractions.

The law, which seeks to stamp out abuses such as child labor, passed with 412 representatives from the ruling Conservative-Social Democrat coalition government and the Green party voting in favor; 159 lawmakers from the business-friendly FDP and the far-right AFD voting against, and 59 from the Left party abstaining.

Both the Greens and the Left complained that the bill had been watered down excessively, with the Greens ultimately going along with the vote and the Left abstaining.

Federal Labor Minister, Hubertus Heil praised the bill, calling it a “milestone.”

Heil said that awareness for human rights along global supply chains had risen and that, “decency and prosperity must not be seen as contradictory.”

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