Fairness First – For a

conscious Collaboration

In our April release of the Brownbag Sessions, we talked about the Supply Chain Act (LkSG for short in German). The new law obliges companies to actively monitor their own supply chain for human rights violations and environmental violations and to take remedial action. First of all, all German companies with more than 3000 employees are affected and from 01.01.2024 also companies with more than 1000 employees. In terms of content, companies must determine clear responsibilities and establish a complaints body in order to incorporate information from the public into the supplier risk analysis. The latter must be submitted event-specific or at least annually. If cases of e. g. human rights violations are detected, remedial/preventive measures must be taken. The entire chain of these activities results in an annual report, which the companies must publish themselves and make available to the Federal Office for Economic Affairs and Export Controls (BAFA for short in German).

Companies see the greatest challenge in the increased bureaucratic effort and the associated costs. Notably, the consumer goods industry with numerous risky supply chains, including cocoa, coffee and textiles. Intelligent IT systems offer the possibility of legally compliant and cost-efficient implementation of the LkSG. This is where we come into play as 4brands Reply. Together with our customers from the consumer goods industry, we develop individual solutions that integrate into the existing IT infrastructure and keep the additional effort and costs to a minimum.

At present, it is up to you to determine exactly how companies comply with their due diligence obligations. In order to keep costs low in the long term and also avoid fines of up to 2% of annual turnover, we recommend a solution that is as digital and automated as possible. Are you also interested in an efficient, system-based implementation of the LkSG? Please feel free to contact us.