The call for more environmental, social and governance (ESG) awareness by business, and specifically in relation to improvement of global supply chain standards, has increased significantly over the last decade. With legally required due diligence obligations and further ESG regulation on the rise, companies will look more frequently to explore possibilities to collaborate with their industry peers as a means to create synergies and pool know-how. These efforts to collaborate with potential industry competitors, as well as via acquisitions, such as within green technology innovations, will attract increasing regulatory scrutiny. In an effort to provide guidance while setting out some regulatory boundaries, the European Commission recently published a draft of its revised “Horizontal Guidelines” on collaboration between competitors, with a new chapter dedicated to sustainability co-operations. This comes on top of guidance and regulatory changes implemented by a number of authorities and policy makers across Europe. Understanding these guidelines will be critical as companies endeavor to comply with the applicable frameworks and antitrust laws.
This article by Maria Dreher and Tim-Erik Held aims to shed light on how ESG compliance of supply chains can be fostered under antitrust law and is intended to provide companies with practical guidance to navigate an increasingly stringent regulatory environment. The authors discuss the latest draft guidelines of the European Commission on the basis of various scenarios and examples of sustainability agreements. With a view to providing a comprehensive yet pragmatic insight, the article also focuses on risk assessment and planning from an ESG perspective in the context of M&A.
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This material was first published by Thomson Reuters, trading as Sweet & Maxwell, 5 Canada Square, Canary Wharf, London, E14 5AQ, in European Competition Law Review, Issue 9, as ESG & supply chains: a practical outlook on opportunities and challenges under antitrust law and is reproduced by agreement with the publishers.