Swiss companies with more than 250 employees should be required to report on their sustainable management and respect for human rights. The Federal Council has opened a consultation in order to harmonize Swiss law with international rules. But unlike the European Union, no sanctions are planned.
Large companies with 500 or more employees now have an obligation to provide information on the risks generated by their activities in terms of environmental, social, personnel, respect for human rights and the fight against corruption. This duty of care is enshrined in the law which came into force in 2022 after the rejection of the popular initiative “for responsible multinationals”.
The EU recently adopted a new directive on this subject, which provides that a greater number of companies will be required to publish reports on the risks associated with their activity. As it announced last year, the Federal Council therefore wants to adapt the legislation to the new European rules, while taking into account Swiss specificities. It has opened a consultation procedure that runs until 17 October 2024.
The new European regulation includes sanctions. Fines and civil suits are possible.
>> Read about it: European Parliament imposes a “duty of vigilance” on companies, including Swiss ones
New rules for 3,500 companies
According to the draft, in addition to companies open to the public, companies in Switzerland that have at least 250 employees, a balance sheet total of at least 25 million francs and a turnover of at least 50 million francs will be required , as in the EU, to publish sustainability information when it reaches two of these three thresholds for two consecutive years.
Some 3,500 companies will be required to report on risks linked to their business activity in the areas of environment, human rights and corruption, and the measures they have taken to address them. The bill further provides that the reports must be submitted to an external review company or conformity assessment body.
The new rules on sustainable management will have a cost for the companies subject to them. The Federal Council is currently examining how the Confederation could support Swiss companies in implementing the new rules.
“Switzerland remains behind”
Reacting to the opening of this consultation, the Coalition for Responsible Multinationals believes that “Switzerland thus remains behind on the issue” compared to international developments.
“The EU recognized years ago that mandatory reporting alone does not solve the problems,” she notes, because it “does not lead to the necessary changes in behavior.” This is why the EU developed the Multinational Liability Directive (CSDDD), adopted on May 24, which provides for “an extended duty of vigilance for companies as well as effective sanctions”.
>> Listen to the reaction of Dominique de Buman, member of the coalition for responsible multinationals:
The Swiss Union of Arts and Crafts (usam) also criticized this toughening, but for diametrically opposed reasons. The project will generate new costs for SMEs, writes the umbrella organization. And these new charges will be passed on to suppliers of medium-sized companies. Instead, USAM calls for reducing unnecessary regulations.
>> Also listen to the reaction of Olivier Feller (PLR/VD),:
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