Is severity the same as likelihood?

No. The Directive pairs the two, and defines only severity.

Does the Directive rank impacts by severity?

Article 9 provides for prioritisation where not every impact can be addressed at once, and the article uses the word severity.

Severity of an adverse impact

Where severity does work

Severity is a measuring term. It is the scale, scope or irremediable character of an adverse impact, read with a set of gravity factors: the number of individuals affected or who may be, the extent to which the environment is or may be damaged, the irreversibility of the impact and the limits on restoring people or the environment within a reasonable period of time.

The word is used in several places. Articles 9, 11 and 27 contain it. Article 9 deals with prioritisation, and Article 27(4), as replaced, sets the penalty rules. Within Article 27, due account is taken of the nature, gravity and duration of the infringement and the severity of the impacts resulting from it. In Article 11, measures to neutralise or minimise an impact are to be proportionate to the severity of the adverse impact and to the company's implication in it. The definitions of appropriate measures and of risk factors both turn on severity and likelihood.

The definition of a severe adverse impact in point (l) repeats the same gravity factors, so the two points should be read together. Likelihood is used alongside severity, but Article 3 does not define it. A reader who needs a threshold for likelihood will not find one in the definitions article.

Glossary

Appropriate measures

Measures that are capable of achieving the objectives of due diligence by effectively addressing adverse impacts in a manner commensurate to the degree of severity and the likelihood of the adverse impact, and reasonably available to the company, taking into account the circumstances of the specific case, including the nature and extent of the adverse impact and relevant risk factors.

Risk factors

Facts, situations or circumstances that relate to the severity and likelihood of an adverse impact, including facts, situations or circumstances at the level of the business partner, such as whether the business partner is not a company covered by this Directive or other comparable mandatory sustainability due diligence legal acts; at the level of geography and context, such as the level of law enforcement with respect to the type of adverse impact; and at the level of sectors, of business operations, and of products and services.

Severe adverse impact

An adverse impact that is especially significant on account of its nature, such as an impact that entails harm to human life, health or liberty, or on account of its scale, scope or irremediable character, taking into account its gravity, including the number of individuals that are or may be affected, the extent to which the environment is or may be damaged or otherwise affected, its irreversibility and the limits on the ability to restore affected individuals or the environment to a situation equivalent to their situation prior to the impact within a reasonable period of time.

Adverse impact

An adverse environmental impact or adverse human rights impact.

Regulations

Corporate Sustainability Due Diligence Directive (CSDDD)

The Corporate Sustainability Due Diligence Directive is Directive (EU) 2024/1760. After Omnibus I, Member States must transpose it by 26 July 2028 and apply it from 26 July 2029, to companies with more than 5,000 employees and EUR 1.5 billion in net worldwide turnover. The Netherlands has a draft bill, the Wivo, which names the ACM as supervisor.

Next26 July 2027 · Set by law

Commission adopts guidelines under Article 19(2), points (a), (d) and (e), and guidance on model contractual clauses (Article 18)