Designing EU Supply Chain Regulation

Gabriel Felbermayr, Klaus Friesenbichler, Markus Gerschberger, Peter Klimek and Birgit Meyer
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Gabriel Felbermayr: WIFO

No 669, WIFO Working Papers from WIFO

Abstract: The EU Directive on Corporate Sustainable Due Diligence has sparked fierce debate about the regulations of supply chains. The Directive's objectives are aligned with European values. Assuming that enforcements of social and environmental rules are absent in certain third countries, it privatises compliance costs in complex supply networks. This paper suggests options to make the Directive more effective and efficient. It should exclude countries with a sufficient regulatory system and focus not on the entire network but on supplier-buyer relationships only. Public agencies should set harmonised regulatory standards, interpret the regulations and organise a private certification scheme in which liabilities are assumed by certification companies. The proposed system resembles the market for financial auditors.

Keywords: EU; Supply Chain; Due Dilligence; Regulation; Firm; International Trade (search for similar items in EconPapers)
Pages: 12 pages
Date: 2024-01-15
New Economics Papers: this item is included in nep-acc, nep-eec, nep-eur, nep-int and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:wfo:wpaper:y:2024:i:669

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