Europe’s controversial due diligence law has hit another snag today, with the delay of a crucial vote on a revised proposal.

The Corporate Sustainability Due Diligence Directive (CS3D) was provisionally agreed in December, but has been fighting for survival ever since, after a last-minute change of heart from a number of member states who think the rules will be bad for business.

In a dramatic moment in European politics, the agreed text failed to get the green light from ambassadors last week, and the Belgian Presidency of the European Council was forced to return to the negotiating table to draft a more palatable alternative.

Time is running out for the file, which has been hailed as the first law that could force widespread behavioural change in the private sector on sustainability issues.

The European elections mean there are just days remaining to come to an agreement in time for the legislation to survive. Otherwise, it will have to be renegotiated by the next European Parliament, or ditched altogether.

The Belgian presidency presented a compromise earlier this week, proposing major new carve-outs and concessions.

The scope of CS3D would be reduced by around 60%, covering just 7,000 entities. The revision also ditches the requirement for executive remuneration policies to complement an entity’s climate objectives, and provisions around access to justice.

At a meeting yesterday, representatives from Belgium, Poland, Ireland, Finland, the Netherlands and Spain all suggested they could support the compromise. So did the European Commission.

Notably, France, Germany and Italy did not speak. Germany has already made it clear the revisions do not go far enough to gain its approval at vote, making it crucial for the proposal to have the support of almost all other member states.

The vote is understood to have been pushed back to 15 March, to buy more time to convince member states to throw their weight behind it. If it does secure a qualified majority, it will still need to be signed off by Parliament.

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