EU Corporate Sustainability Due Diligence Directive: The Timeline and Indian Supplier Impact

The EU Corporate Sustainability Due Diligence Directive (CSDDD) creates mandatory supply chain due diligence obligations for large EU companies — with explicit reach to their Indian suppliers.

CSDDD timeline: Directive entered force July 2024. Large EU companies (1,000+ employees, EUR 450M+ turnover): comply from 2027. Medium EU companies (500-1,000 employees, EUR 150-450M turnover): from 2028. Small-to-mid EU companies and EU-listed non-EU companies: 2029.

What CSDDD requires EU companies to do regarding Indian suppliers: (1) Identify actual and potential adverse human rights and environmental impacts in supply chain including Indian tier 1 and tier 2 suppliers; (2) Prevent, mitigate, or remedy identified impacts; (3) Establish complaints and grievance mechanisms for supply chain workers including Indian factory workers; (4) Monitor effectiveness of due diligence measures; (5) Communicate on due diligence annually in CSRD sustainability report.

What this means for Indian suppliers in practice: Large EU companies will send supplier self-assessment questionnaires, conduct third-party supplier audits (SMETA, EcoVadis, custom audit), require contractual compliance commitments, and potentially terminate supplier relationships where due diligence risks cannot be managed.

How to prepare: Implement a management system for human rights and environmental performance. Complete EcoVadis or similar standardised sustainability rating. Maintain audit-ready documentation on wages, hours, safety incidents, environmental management, and grievance mechanisms. Being a cooperative, transparent supplier reduces audit frequency and risk of de-listing.