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Shift Project Limited

Shift

Shift is the leading center of expertise on the UN Guiding Principles on Business and Human Rights.

Lobbying Activity

Meeting with Jörgen Warborn (Member of the European Parliament, Rapporteur)

24 Nov 2025 · Omnibus

Meeting with Jörgen Warborn (Member of the European Parliament, Rapporteur)

16 Oct 2025 · Omnibus

Meeting with Pascal Canfin (Member of the European Parliament, Shadow rapporteur) and Stichting Fair Trade Advocacy Office and La Banque Postale

16 Sept 2025 · Omnibus I

Response to Revision of EU rules on sustainable finance disclosure

30 May 2025

The ESRS include a number of datapoints that reference SFDR social indicators so that financial market participants are able to comply with SFDR by relying on public data reported by real economy companies in line with the CSRD. Therefore, we welcome the proposition that any upcoming revision to SFDR should wait until the ongoing ESRS revision process is finalized so that any changes made can be taken into account in the SFDR revision process. The ongoing ESRS revision process should provide an opportunity to address some of weaknesses in social indicators in SFDR and find better anchors in ESRS for making information decision-useful. Firstly, indicator #11 Lack of processes and compliance mechanisms to monitor compliance with UN Global Compact [sic] principles and OECD Guidelines for Multinational Enterprises should be retained in Table 1, mandatory PAI indicators, but corrected so that it references the UN Guiding Principles (UNGPs) rather than the UN Global Compact as the Final Report on draft Regulatory Technical Standards: on the review of PAI and financial product disclosures in the SFDR Delegated Regulation (December 2023) from the European Supervisory Authorities (ESAs) suggests. This change would also make SFDR more aligned with the EU Taxonomy, which references the UNGPs not the UN Global Compact as the relevant international standard. The reference data point in the ESRS for indicator #11 should also be changed from SX-1 on the existence of policies, to ESRS 2 GOV 4 statement on due diligence § 30 and 32. The existence of policies tells one little about processes and compliance mechanisms. ESRS 2 GOV 4 is designed to capture information that demonstrates a companys maturity in relation to due diligence processes that are in place in line with the international standards of the UNGPs and OECD Guidelines. Secondly, indicator #16 Share of employees of investee companies earning less than the adequate wage, which is suggested as a mandatory indicator in the Final Report on draft Regulatory Technical Standards: on the review of PAI and financial product disclosures in the SFDR Delegated Regulation (December 2023), should be implemented as a mandatory indicator in Table 1 in the revised SFDR. Thirdly, indicator #10 Lack of due diligence should be retained, as opposed to what the Final Report on draft Regulatory Technical Standards: on the review of PAI and financial product disclosures in the SFDR Delegated Regulation (December 2023) from ESAs suggests. It will be important to retain this SFDR indicator as a reference point for national supervisory bodies tasked with enforcement of the CSDDD. It will also be important for users of annual reports seeking an understanding of how a company is applying risk-based due diligence according to international standards supporting comparability in relation to how well a company manages its most salient impacts. Overall, many of the Principal Adverse Impact (PAI) indicators focus on policy-related disclosures, which in a reporting context fail to provide any insight into the likelihood of implementation and effective outcomes. A number of other PAI indicators focus on the sheer number of incidents and severe impacts, which is of little value in a reporting context and may have perverse consequences since such indicators do not distinguish between companies where incidents/violations/impacts are underreported because companies are not adequately identifying them, and companies where there is a low number of such incidents/violations/impacts because the company effectively takes action to address them. We understand that the revision of the PAI under the SFDR will be adjusted to take account of changes to the ESRS, such that removing such datapoints and making it clear which SFDR datapoints are represented by equivalent ESRS datapoints at real economy entity-level should be possible without creating a tension between the two sets of disclosure standards.
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Meeting with Kira Marie Peter-Hansen (Member of the European Parliament, Shadow rapporteur) and PepsiCo and Responsible Business Alliance

10 Apr 2025 · Sustainability omnibus

Meeting with Kira Marie Peter-Hansen (Member of the European Parliament, Shadow rapporteur) and European Coalition for Corporate Justice and Frank Bold Society

7 Apr 2025 · CSO exchange on sustainability omnibus

Meeting with Axel Voss (Member of the European Parliament)

5 Feb 2025 · Sustainability Omnibus

Meeting with Kira Marie Peter-Hansen (Member of the European Parliament)

2 Dec 2024 · Update on sustainability reporting omnibus

Meeting with René Repasi (Member of the European Parliament)

23 Sept 2024 · Exchange on Sustainable Finance, CSDD, CSRD

Meeting with Heidi Hautala (Member of the European Parliament, Shadow rapporteur) and Cisco Systems Inc. and

18 Apr 2024 · Multi-stakeholder discussion on CSDDD

Meeting with Helmut Scholz (Member of the European Parliament) and EUROPEAN TRADE UNION CONFEDERATION and

18 Apr 2024 · CSDDD

Meeting with Lara Wolters (Member of the European Parliament, Rapporteur)

11 Sept 2023 · Staff level: CSDD Directive

Meeting with Lara Wolters (Member of the European Parliament, Rapporteur)

28 Aug 2023 · Staff level: CSDD Directive

Meeting with Lara Wolters (Member of the European Parliament, Rapporteur)

4 Apr 2023 · Staff level: CSDD Directive

Meeting with René Repasi (Member of the European Parliament, Rapporteur for opinion)

6 Mar 2023 · EU-Lieferkettengesetz/ Corporate Sustainability Due Diligence Directive (CSDDD)

Meeting with Lara Wolters (Member of the European Parliament, Rapporteur)

10 Jan 2023 · Staff level: CSDD Directive

Response to Sustainable corporate governance

20 May 2022

Shift strongly welcomes the proposal for a draft Directive on Corporate Sustainability Due Diligence. The initiative is an opportunity with few parallels in its potential to drive sustainability into the heart of how business gets done. However, for the Directive to meet its stated ambition, it must be more firmly grounded in the key international standards on sustainability due diligence - the UN Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises. We focus on five areas where a lack of such alignment will hinder the Directive’s ability to meet its objectives. 1. SCOPE OF THE DUE DILIGENCE DUTY The draft Directive tries to make due diligence manageable for businesses by limiting both the duty to do due diligence and liability for breaches of it to ‘established business relationships’. Yet this novel concept runs counter to the international standards, under which companies’ responsibilities flow from the connection between negative impacts at any point in the value chain and companies’ operations, products and services, and not from the proximity of the relationships involved or the ease with which impacts can be identified and addressed. Allowing for prioritization of impacts based on their severity is the key factor in making due diligence manageable and ensuring it tackles the most salient risks to people. The draft should align the scope of the duty with the core concepts in the international standards. And it could take better advantage of the complementary roles for administrative supervision (covering the full scope of the duty) and civil liability (for harms that businesses cause or contribute to through their own operations, or through the operations of another entity that they control). 2. DEMONSTRATING COMPLIANCE The draft heavily relies on contractual assurances and audits to show compliance. Yet these have been proven to be of limited efficacy in delivering improved outcomes for people, while generating significant costs to companies and often shifting responsibility from lead companies onto their business partners without attention to their own practices. Assessing compliance with the duty should rely on other factors, including: the robustness of a company’s risk assessment and prioritization approach; its attention to whether its own practices contributed to harm; its use of the full range of approaches to leverage beyond contractual clauses; and greater attention to the role of the Board. 3. CENTRAL ROLE OF AFFECTED STAKEHOLDERS Meaningful engagement with affected stakeholders is central to effective due diligence. The draft’s provisions should be strengthened on: the specific moments when engagement with affected stakeholders is most important during due diligence; the robustness of complaints procedures; and taking a human rights view of remedy where harm occurs by considering the adequacy of the process and outcome from the perspective of those who are impacted. 4. COVERED COMPANIES The limited scope of covered companies risks also limiting the draft’s potential to create a truly level playing field. While recognizing that there may be good reasons to stagger the imposition or implementation of new legal duties across different types of companies, the draft does not give consistent, risk-based rationales for why certain companies are out of the initial scope. 5. FINANCIAL SECTOR The draft creates several exceptions for the financial sector, which ignores how such companies are already showing the feasibility and benefits of directing their due diligence efforts towards the most severe sustainability risks. The draft should not undermine the role and responsibility of the sector in addressing risks in line with the international standards, and the catalytic effect this can have for other sectors. For our detailed analysis see the attached document.
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