Due diligence

 

Due diligence at EU level

At the initiative of EU Justice Commissioner Didier Reynders, the European Commission launched a legislative initiative on sustainable corporate governance in 2020: the ‘Initiative on Sustainable Corporate Governance’. This initiative aims for binding and transversal legislation via two pillars: increased liability for directors on the one hand, and sustainable corporate governance on the other. The initiative draws on existing OECD obligations for multinational enterprises and OECD guidelines on due diligence. This initiative is part of the Green Deal initiatives, and builds upon the Action Plan for Financing Sustainable Growth. The aim is to launch a legislative proposal in the course of 2021, following broad public consultation, and to engage in effective negotiations.

 
Business and human rights

Respect for human rights within the business world has been on the agenda of various international fora since the 1970s.

The discussion gained momentum at the United Nations in the mid-2000s. This resulted in 31 guidelines on business and human rights, which the Human Rights Council adopted in 2011. 

With a view to the implementation of the United Nations guidelines on business and human rights, Belgium adopted its first National Action Plan (NAP) for Business and Human Rights on 20 July 2017.

Within the FPS Foreign Affairs, the Human Rights department is the pilot for actions relating to business and human rights, in close consultation with the Economic Interests department (B3).

During the princely economic missions, the FPS Foreign Affairs systematically organises an activity related to the topic of business and human rights, in application of this National Action Plan.

 
Sustainable exploitation of natural resources

Belgium is pursuing a policy of sustainable and inclusive extraction of raw materials that benefits the development of local communities. The Belgian focus is on mineral raw materials such as diamonds, gold and cobalt and on the Belgian strategic link with Africa. In order to shape this policy, Belgium actively participates in various international fora, organisations and legislative initiatives to ensure that the various initiatives are consistent with each other.

 
(a) The Kimberley Process (KP) is a multilateral trade regime established in 2003 to stop the trade in conflict diamonds. The KP brings together international governments, NGOs and the diamond industry in an organisation of 55 members representing 82 countries. All the member states together account for approximately 99.8% of the world's rough diamond production. The core of the KP is the Kimberley Process Certification Scheme (KPCS), under which states take legal measures to inspect and certify the trade in rough diamonds as ‘conflict-free’ through a KP certificate.

The Kimberley Process meets twice a year to discuss the current state of play, compliance with the KPCS regulations and future prospects. In Belgium, the Kimberley Process and regulations are monitored by a partnership between the FPS Economic Affairs (licences department), FPS Foreign Affairs and the FPS Finance and Customs in collaboration with the Antwerp diamond industry.

Belgium, as the world's largest diamond trading and sorting centre for rough diamonds, is considered an important international player within the KP.

https://www.kimberleyprocess.com/

 
b) The FPS Foreign Affairs participates annually in the Organisation for Economic Co-operation and Development's ‘OECD Forum on responsible mineral supply chains’. Each year, this forum discusses the state of play with the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas, as developed by the OECD. This guideline, and its roadmap for sustainable supply chain management, is seen as the gold standard for sustainable extraction of mineral resources. The Forum brings together representatives from public authorities, the private sector and NGOs.

 
(c) Belgium has actively co-operated with the new EU regulations on conflict minerals, tin, tungsten, tantalum and gold (EU Regulation 2017/821). The Regulation was adopted in 2017 and will enter into force on 1 January 2021. This European legislation imposes conditions regarding sustainable corporate governance (Due Diligence) for the import of the metals focused upon. This legislation is fully based on the OECD guideline and the step-by-step plan for sustainable corporate governance. The FPS Economy is the supervisory authority for the implementation of legislation.

 
(d) Belgium makes an annual financial contribution to the Extractive Industries Transparency Initiative (EITI), a programme launched by British Prime Minister Blair at the World Summit on Sustainable Development in Johannesburg in 2002. EITI supports “good governance” for the benefit of local populations in resource-rich countries. EITI does this through a voluntary partnership between public authorities, the private sector and civil society. EITI focuses on the verification and full publication of corporate invoices and government revenue from the oil, gas and mining sector, on the participation of civil society and the true ownership of mining activities. Belgium is paying particular attention to the implementation of the EITI programme in the DR Congo. The EITI programme is supported by the Extractives Governance Programmatic Support (EGPS) under the auspices of the World Bank. Belgium joined this fund in 2017.

https://eiti.org and https://www.worldbank.org/en/programs/egps