CSDDD 101: Corporate Sustainability Due Diligence Directive explained
What is CSDDD, when does it enter into force, which companies are in scope and how does it relate to EUDR, CBAM and NFRD?
The Corporate Sustainability Due Diligence Directive (CSDDD, Directive 2024/1760) requires large EU companies to identify, prevent, mitigate and report on human-rights and environmental risks across their value chain. For trade compliance teams it is the broadest regulation ever placed above origin/customs/CBAM.
When does CSDDD apply?
The directive was published in July 2024. Member States had until 26 July 2026 to transpose it into national law. Application is phased by company size:
- July 2027 — companies with >5,000 employees AND >€1.5 billion revenue
- July 2028 — companies with >3,000 employees AND >€900 million revenue
- July 2029 — companies with >1,000 employees AND >€450 million revenue
Smaller companies are not directly in scope but are indirectly affected via supplier due diligence requirements from their large clients.
What does CSDDD require?
A six-step due diligence cycle:
- Integration of due diligence into policies and risk management
- Identification of actual and potential negative impacts
- Prevention and mitigation via supplier engagement and remediation
- Monitoring of effectiveness
- Communication (annual publication)
- Complaints mechanism accessible to affected parties
Which risks are in scope?
Human rights — child labour, forced labour, safety incidents, discrimination, freedom of association (based on UN Guiding Principles and ILO fundamental conventions).
Environment — GHG emissions, pollution, biodiversity loss, deforestation (partial overlap with EUDR), water depletion, hazardous substances.
The scope covers your own operations, your subsidiaries, and your chain of activities — the upstream supply chain and part of the downstream distribution.
Relationship with EUDR, CBAM and NFRD
| Regulation | Focus | In force |
|---|---|---|
| NFRD / CSRD | Non-financial / sustainability reporting | 2024 |
| CBAM | GHG in carbon-intensive imports | 2023-2026 |
| EUDR | Deforestation risk per product batch | 2025-2026 |
| CSDDD | Human rights + environment across value chain | 2027-2029 |
CSDDD is the overarching obligation. EUDR and CBAM are product-specific; CSDDD forces an entire supply-chain due diligence system.
Overlap with trade compliance
Good news: supplier data you already have for LTSD, EUDR and CBAM is directly reusable for CSDDD. Additional needs:
- Human rights audit reports per supplier (SA8000, SMETA)
- Climate risk assessments per production site
- Complaints mechanism integration
The tool stack overlaps: same supplier master data, same evidence locker, same audit trail.
What PSRA adds
PSRA's supplier declaration module is designed to store sustainability evidence alongside origin evidence. The CSDDD module (design phase, release Q2 2027) uses the existing supplier registry for grievance mechanism and audit reports.
Related articles
- Audit-proof operations: 7 principles for compliance officers: Learn the seven fundamental principles that make your compliance organisation audit-proof, from documentation standards to automated controls.
- Compliance as competitive advantage: how leaders win: Discover how forward-thinking companies deploy compliance as a strategic weapon rather than a cost centre.
- From customs penalty to compliance advantage: a case study: How a mid-size importer turned a six-figure customs penalty into a structural compliance advantage through automated origin determination.
Related downloads
- Whitepaper: 30-minute demo to trial: 14-day plan from demo to trial outcomes for origin, LTSD, and CBAM workflows.
- Comparison: Excel workflows vs PSRA: Finance-oriented ROI framing and migration checklist for operations teams.
- Case study template for compliance outcomes: Reusable structure to document measurable compliance impact, audit outcomes, and workflow improvements.
Related definitions
- Audit trail: An audit trail records who did what, based on which source data, and with what decision logic.
- BOM: A BOM is the bill of materials: the structured composition of a product.
- Supplier declaration: A supplier declaration captures the origin information a supplier provides for supplied goods.
- Customs declaration: A customs declaration is the formal notification to customs declaring goods for import, export, or transit, available in five procedure types.