Frank Bold and ClientEarth released their report Environmental Due Diligence under the Corporate Sustainability Due Diligence Directive (September 2026).
Human Level’s Take:
- The Omnibus I amendments may have reduced the CSDDD’s scope, but they have not fundamentally changed what due diligence asks companies to understand: how business activities affect people, including through environmental impacts. And while the specific climate transition plan requirement has been removed, this does not remove climate-related responsibilities where environmental harm has human rights consequences.
- Environmental harm and human rights impacts are often two sides of the same coin. Pollution, deforestation, excessive water use and harmful emissions can directly affect rights to food, water, health, safety and property.
- Climate change makes this interconnection particularly clear. The report argues that greenhouse gas emissions can constitute “harmful emissions” where their effects contribute to impacts on protected rights. In this context, separating environmental due diligence from human rights due diligence may become increasingly artificial.
- The practical shift is therefore towards a more connected view of risk. Effective due diligence means looking beyond how an impact is labelled and focusing instead on how it travels through operations and value chains, who is affected, and what action is needed in response.
Some key takeaways:
- CSDDD may be narrower in scope, but the core due diligence obligation remains unchanged: Frank Bold and ClientEarth find that, despite the Omnibus I amendments narrowing the CSDDD’s scope and environmental provisions, companies within scope remain required to conduct due diligence on both human rights and environmental impacts. The amended Directive now applies to EU companies with more than 5,000 employees and net worldwide turnover exceeding EUR 1.5 billion, reducing the number of companies covered to an estimated 2,907. The report cautions that this narrower scope departs from international standards, which envisage due diligence regardless of company size, and could limit the Directive’s effectiveness in addressing human rights and environmental harm. The amendments also remove the requirement for companies to adopt climate transition plans aligned with the Paris Agreement’s 1.5°C goal. However, the authors stress that this does not remove companies’ broader climate-related responsibilities. Businesses continue to face requirements under the CSRD and evolving national tort law, potentially creating a more fragmented and uncertain regulatory landscape rather than a simpler one.
- Environmental harm can also constitute a human rights impact: The analysis explains that Point 15 of the CSDDD’s Annex Part 1 brings environmental degradation within the due diligence framework where it impairs protected rights. This includes harmful emissions, water and air pollution, excessive water consumption and deforestation where they affect rights such as food, water and sanitation, health, safety or property. The authors find that “harmful emissions” encompasses greenhouse gas emissions, given the established links between climate change and impacts on internationally recognised rights, including among others the rights to life, food, water and health. They point to a June 2026 French court ruling against TotalEnergies as further support for interpreting environmental harm broadly enough to include climate change. In practice, environmental and human rights impacts may therefore arise from the same business activity: for example, aquaculture operations that destroy mangroves used for flood protection and fish habitat, or agricultural operations whose water extraction causes community wells to run dry.
- Environmental impacts as part of risk-based human rights due diligence processes across the value chain: For companies, the report translates this connection into practical due diligence expectations. Where environmental impacts have human rights implications, companies need to take a risk-based approach, prioritising impacts according to their severity and likelihood across the value chain. Depending on the circumstances, appropriate measures may include developing prevention or corrective action plans, seeking contractual assurances from business partners, making necessary financial or non-financial investments, and adapting business plans, strategies and purchasing practices. Where an impact cannot immediately be prevented, mitigated or brought to an end, companies are still expected to adopt an action plan before considering suspension of the relevant business relationship. The report also highlights practical constraints introduced by the Omnibus I amendments, including tighter conditions on requesting information from smaller business partners and longer intervals between monitoring exercises. In the authors' view, these changes may make effective due diligence more difficult in practice, even where the underlying obligation to address environmental impacts with human rights implications continues to apply.
