Due Diligence: Mediation, an Effective Alternative

The French law on the duty of vigilance was adopted in 2017. It marked a historic turning point in the legal framework governing the practices of multinational companies. Being the first binding legislation of its kind in the world, it requires large companies to prevent human rights and environmental abuses in their value chains. Seven years after its adoption, the results remain mixed. Indeed, its implementation has revealed significant limitations, particularly in terms of litigation. The first court cases received widespread media coverage. Above all, they highlighted the inadequacy of the courts to deal with these complex issues. The debates became bogged down in procedural considerations and the fundamental issues were overshadowed: human rights violations and environmental damage.

This raises a key question: is the judicial approach really the best way to promote corporate vigilance and protect victims? At the same time, societal expectations and international regulatory frameworks continue to evolve. The OECD Guidelines, sectoral certifications, and now the CS3D directive are creating a regulatory ecosystem. Companies must navigate this ecosystem, regardless of national legislation.

In this context, mediation is emerging as a promising alternative. This alternative is capable of overcoming the pitfalls of traditional litigation, while guaranteeing the effectiveness of stakeholder rights and the continuous improvement of business practices.

The Lasting Integration of the Duty of Vigilance into International Standards

Beyond political fluctuations and national legislative debates, the duty of vigilance has become firmly anchored in the international normative framework. This dynamic transcends borders and is progressively establishing itself as an essential standard of conduct for global economic actors.

The OECD Guidelines: A Comprehensive Benchmark

First and foremost, the OECD Guidelines for Multinational Enterprises, revised in 2023, constitute the most comprehensive benchmark for responsible business conduct. Adopted by 51 states, they promote a systematic approach to due diligence. The guidelines cover all potential negative impacts related to human rights, the environment, corruption, and working conditions. They go beyond general recommendations, setting out a rigorous process for identifying, preventing, mitigating, and remedying adverse impacts. The National Contact Points (NCPs) promote the guidelines and provide an accessible, non-judicial grievance mechanism.

Other Sectoral Frameworks

This institutionalization is accompanied by a proliferation of sectoral standards and certifications that are progressively integrating vigilance requirements. In the textile industry, initiatives such as the Fair Wear Foundation and the Global Organic Textile Standard (GOTS) impose regular social audits and supply chain traceability. The extractive sector has developed the Extractive Industries Transparency Initiative (EITI) and the Initiative for Responsible Mining Assurance (IRMA) standard. In the agri-food sector, certifications integrating strict social and environmental criteria—such as Fairtrade and Rainforest Alliance—are multiplying.

Why Is the Duty of Vigilance a Crucial Step for Businesses?

The European directive on the duty of vigilance (CSDDD) marks a new stage toward harmonizing corporate responsibility obligations. Although less ambitious than the initial proposal, it extends its scope to all large companies operating in Europe. The duty of vigilance is no longer a French peculiarity; it now forms part of the regulatory framework for all European businesses.

This normative convergence is transforming global value chains. Lead firms now require their suppliers to comply with social and environmental standards, backed by regular audits. Institutional investors incorporate these criteria into their ESG analyses, conditioning access to capital on evidence of genuine vigilance. Better-informed consumers are also increasing pressure on brands.

In this context, companies have every incentive to anticipate these developments rather than merely react to them. The issue goes beyond simple legal compliance with national law—it involves embedding a lasting culture of vigilance. Such a culture helps secure operations as a whole and preserves the company’s social license to operate. This economic and normative reality endures regardless of ongoing litigation in France.

Limits of the Judicial Approach

The French litigation experience surrounding the duty of vigilance has revealed major structural dysfunctions. This raises serious questions about the relevance of relying on judicial action as the main driver for ensuring the law’s effectiveness. Far from clarifying corporate obligations or redressing alleged harms, the proceedings launched so far have often stalled in sterile and highly technical debates.

Illustrative Cases: Evidence of a Deadlock

The landmark cases brought before French courts illustrate this impasse. The TotalEnergies case in Uganda and the Casino case involving its Brazilian suppliers are emblematic. Hearings have focused primarily on procedural issues — admissibility, territorial jurisdiction, and the standing of organizations to bring claims. Judges are faced with complex realities: international causal chains are difficult to establish. As a result, they tend to confine their analysis to formal procedural aspects. The substance of the grievances — violations of local communities’ rights, deforestation, inhumane working conditions — remains largely unexamined.

This situation exposes a clear mismatch between the nature of the issues at stake and the tools of traditional litigation. Civil judges lack both the technical expertise required to grasp the complex operational realities of global value chains and the investigative means to establish facts occurring in distant and culturally diverse contexts. How can a Paris court realistically assess the effectiveness of a vigilance plan concerning third-tier subcontractors operating in rural areas of Southeast Asia or Sub-Saharan Africa?

A Disappointing Outcome for All Parties

For civil society organizations and trade unions that initiated these actions, the results have often been disappointing. After years of proceedings, no tangible progress has been achieved. The legal costs are substantial, while affected communities continue to await concrete remedies. Worse still, procedural gridlock diverts attention from substantive issues and drains activist energy. A question arises: is it wise to devote so many resources to uncertain legal battles? Wouldn’t direct field action, bringing immediate benefits to affected populations, be more effective?

From the corporate perspective, the picture is hardly more encouraging. Many companies discover the extent of their blind spots in vigilance only when they are served with a lawsuit. Forced into a defensive posture, they channel their efforts into contesting procedures rather than identifying and addressing the underlying risks. Yet behind the claims lie real vulnerabilities — weaknesses in control systems, lack of awareness of supplier practices, and absence of effective alert mechanisms. The litigious approach deprives companies of an opportunity for learning and continuous improvement in their due diligence systems.

This situation also generates harmful legal uncertainty. The absence of established case law defining the precise contours of vigilance obligations leaves companies unsure about the standards expected of them. Without clear benchmarks, it is difficult to calibrate the necessary investments in due diligence or to choose between competing methodological approaches. Litigation, far from clarifying the rules of the game, only deepens the ambiguity.

Mediation: An Effective and Pragmatic Alternative

In light of the limitations of judicial proceedings, mediation emerges as an alternative solution to make the ambitions of the duty of vigilance a practical reality. While not a universal remedy for every situation, when overseen by an independent and expert third party, mediation goes beyond confrontational logics and can be effectively mobilized in a variety of contexts. It enables the development of sustainable and pragmatic solutions. The mediation process unfolds in three complementary phases. Each serves a specific purpose and contributes to the effective implementation of the duty of vigilance.

The Main Stages of the Mediation Process

Phase 1: Understand the Issues

The first step consists of methodically clarifying the expectations: What are the specific grievances raised? Which legal or normative obligations are at stake? What negative impacts are alleged, and how material are they? This rigorous framing avoids misunderstandings and refocuses dialogue on verified facts rather than diverging perceptions. The mediator—an expert in the sector and in international standards—plays a key role in clarification and education.

Phase 2: Bridging Perception Gaps

The second phase seeks to bridge perception gaps between the parties. In most cases, divergences stem not from bad faith, but from asymmetries in information and understanding. Companies are sometimes unaware of the local realities faced by their suppliers or affected communities, while NGOs may underestimate the operational complexity of global value chains. The mediator creates a space for listening and constructive dialogue. This fosters the search for balanced solutions where litigation would have only deepened confrontation.

Phase 3: Building Action Plans

The third and most operational phase consists of jointly developing concrete action plans. Here, the mediator’s expertise proves invaluable. Their knowledge of sectoral challenges, best practices, and local contexts helps guide the parties toward realistic and effective solutions. Rather than settling for general commitments, the process results in detailed roadmaps that may include:

• Strengthening control mechanisms
• Establishing whistleblowing and grievance channels
• Supplier training programs
• Remediation measures for identified harms
• Monitoring indicators to track the impact of implemented measures
• Shared governance mechanisms, where appropriate

These plans include timelines and verification mechanisms, ensuring their long-term effectiveness.

At Ksapa, we have experience acting as mediators for various OECD National Contact Points (NCPs), which have been handling complaints related to responsible business conduct for more than twenty years through mediation-based processes—demonstrating the viability of this approach. Many cases have led to mutually satisfactory agreements: compensation for victims, adjustments to sourcing practices, establishment of social dialogue mechanisms, and community development programs. These tangible results stand in sharp contrast to the lengthy and uncertain outcomes of judicial proceedings. There is no obligation to rely solely on these national platforms. At Ksapa, we have also been engaged in direct, ad hoc mediations between stakeholders.

Mediation: A Real Opportunity

It is important to note that mediation in no way deprives parties of the right to seek judicial recourse later. If the process does not result in an agreement, or if one party fails to honor its commitments, legal action remains possible. Mediation is not an exclusive alternative path—it is a constructive first step. In most cases, it helps avoid the costs and delays of litigation while achieving more satisfactory outcomes. For companies genuinely committed to a vigilance approach, mediation offers a unique learning opportunity. It allows them to identify vulnerabilities, understand stakeholder expectations, and strengthen their risk management systems. Far from being a mere crisis management tool, it represents a logic of continuous improvement and prevention of future disputes.

Ksapa’s Commitment: Supporting the Transition Toward Effective Mechanisms

At Ksapa, we are convinced that the effectiveness of the duty of vigilance depends on building mechanisms for dialogue and collaborative dispute resolution. Our mediation experience—with multinational companies as well as within OECD NCP proceedings—has shown us the superiority of this approach over traditional litigation in driving tangible change.

We support companies in structuring their due diligence frameworks by integrating, from the design stage, accessible grievance mechanisms for stakeholders. We train their teams in constructive dialogue techniques and act as third-party mediators when disputes arise. Our sectoral expertise, field experience, and independence enable us to create the trust conditions necessary for collaborative problem-solving.

In parallel, we work with civil society organizations and trade unions to help them engage effectively in mediation processes. We firmly believe that the defense of human and environmental rights is most effective when it combines public pressure, constructive dialogue, and pragmatic resolution mechanisms.

The French Duty of Vigilance Law has opened a promising path forward. To make it fully effective, it is time to expand mediation approaches that help build sustainable solutions together. This is the goal that Ksapa aims to support, for a truly responsible economy.

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