Under the Responsible Business Initiative, Swiss based companies will be legally obliged to incorporate respect for human rights and the environment in all their business activities. This mandatory due diligence will also be applied to Swiss based companies’ activities abroad.
The mandatory due diligence instrument is based on the United Nations Guiding Principles on Business and Human Rights. According to these principles, companies must first review all their business relationships and activities with a view to identifying potential risks to people and the environment. They must then take effective measures to address the potentially negative impacts identified. As a third step, companies are required to report in a transparent manner on the violations identified, as well as on the related measures taken.
Although these provisions already exist in international soft law, they lack enforcement mechanisms to facilitate effective implementation. The UN leaves it to its member states to fill the existing gaps at national level. The Responsible Business Initiative translates this obligation in Swiss law, renders the international due diligence mandatory and broadens the scope of mandatory due diligence by including the protection of the environment.