This study on the economic impact of the EU Corporate Sustainability Due Diligence Directive (CSDDD) assesses the expected implications of the Omnibus process, including the positions of the Commission, the Council and the draft report by MEP Warborn. The study focuses on the effects on the Global South, the effects on global competition and the EU, and the effects on workers in Europe. The conclusion drawn is that the CSDDD is expected to have a considerably positive economic welfare effect on the Global South and positive net effects on the European economy. In addition, the CSDDD tends to strengthen the position of workers not only in the Global South but also in the European Union (EU).

Weakening the CSDDD with the proposed Omnibus Directive, including substantially reducing the number of companies subject to the legislation, is expected to reduce the positive economic effects of the CSDDD significantly. Moreover, the current Omnibus proposals by the Commission, the Council and the Draft Report of the JURI Committee of the European Parliament (“Warborn report”) limit due diligence obligations largely to tier 1 suppliers and substantially weaken the provisions on civil liability. These proposals are expected to drastically reduce the effectiveness of the CSDDD. It is crucial that an effective CSDDD remains in place to ensure that potential positive economic effects occur. It is concluded that the current version of the CSDDD should be left unchanged.