German businesses back supply chain due diligence rules ahead of EU Omnibus
June 30, 2025
A major new survey of over 1,300 German business leaders reveals broad support for the EU’s Corporate Sustainability Due Diligence Directive (CSDDD).
This comes at a time when Chancellor Friedrich Merz and President Emmanuel Macron are calling for the directive’s repeal and pushing for further changes to the Corporate Sustainability Reporting Directive (CSRD).
The CSDDD is an EU regulation requiring companies to identify, prevent, and mitigate adverse human rights and environmental impacts across their value chain. Germany’s Supply Chain Due Diligence Act (LkSG), already in force but with Merz’s intent on repealing, serves as a national-level counterpart by mandating similar due diligence obligations for companies operating in Germany.
Far from being a burden, due diligence laws are seen as a competitive opportunity by most German companies. In fact, the survey shows that political rollback efforts are not aligned with actual business needs.
Due diligence regulations: Burden or benefit for businesses?
Commissioned by the JARO Institute and carried out by YouGov, the poll reveals that numerous German companies perceive due diligence obligations not as a burden, but as a chance to improve competitiveness, stimulate investment in EU supply chains, and inform investment choices:
| 57% of large companies believe due diligence gives EU suppliers a competitive edge. | 44% think the CSDDD will give the EU an advantage over the U.S. and China while 31% disagree. | |
| 50% report the German LkSG has already provided them an advantage over competitors, rising to 54% among firms with over 1,000 employees. | 8% see easing due diligence rules as a top growth priority, far behind concerns like high energy costs (35%), slow planning processes (27%), and digitalisation (23%). |
The damage of uncertainty
Businesses also express frustration over the uncertainty surrounding the future implementation of the CSDDD:
| 51% of respondents agree that revisiting the due diligence rules under the Omnibus is making planning more difficult, while only 12% disagree. | 48% are delaying investment decisions because of political ambiguity. |
Do stronger standards create a stronger economy?
According to the German Sustainable Business Association, BNW (Bundesverband Nachhaltige Wirtschaft), there are four key benefits for ‘improving, not removing’ these standards:
- Trust and transparency: Harmonised reporting helps investors, banks, and customers make better decisions.
- Resilience to risk: Better visibility into supply chains protects against disruption and builds a more secure business relationship.
- Access to funding: In many sectors, sustainable companies increasingly secure better financing, which is increasing as ESG-linked loans becomes more popular.
- Innovation and competitiveness: Regulation spurs efficiency and promotes future-proof business models, such as the circular economy, by reducing waste and inefficiencies in product manufacturing.
Altogether, these methods improve competitiveness among companies operating in the EU by creating a standard model that promotes sustainable business practices.
What businesses actually want
There is a clear and substantial gap between companies in favour of regulatory alignment and those opposing it.
| 56% support harmonised EU-wide due diligence standards. | 20% oppose EU-wide due diligence standards. |
Inaction is your biggest risk, we’re here to help
No matter which way the political winds blow, inaction is your biggest risk, but we’re going to help make the path clear for you.
With over 20 years of experience in climate action and navigating diverse reporting standards, ClimatePartner understands the clear, long-term business value of sustainable practices. We align not only on reporting obligations, but also the majority of German decision-makers who make due diligence a central pillar in improving their business.
Our reporting and regulation services:
- Providing expert guidance on sustainability reporting and voluntary climate action.
- Helping you navigate evolving regulations to maintain transparency and leadership in sustainability.
- Offering solutions that align business success with climate responsibility while covering both voluntary and regulatory frameworks.