Supply-Chain Due Diligence Expands into Employment Risk

EU LEGISLATIVE UPDATE | Directive (EU) 2024/1760

Directive (EU) 2024/1760 was adopted on 13 June 2024, establishing an EU due-diligence framework for large companies and certain non-EU businesses active in the Union.

The Directive requires qualifying companies to identify and address adverse human-rights and environmental impacts in their operations, subsidiaries and relevant chains of activity. Labour standards are a central part of that assessment.

Even businesses outside direct scope may feel the effect through customer questionnaires, contractual warranties and supplier audits. Italian labour-only subcontracting, undeclared work and unsafe contractor practices can therefore create wider group exposure.

Companies should connect procurement due diligence with HR and safety expertise. Supplier clauses should be supported by proportionate verification, escalation and remediation rather than a generic code signed once at onboarding.

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