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A new proposal for an EU Directive on mandatory due diligence for companies was presented by the European Commission on February 23, 2022. The question, however, is whether the law will be as powerful as many are hoping. When a company locates its production in a state where human rights are not respected, there is currently no binding international framework regulating the company's activities. The UN Guiding Principles on Business and Human Rights (UNGP), a non-binding framework for corporate human rights due diligence, and the OECD Guidelines for Multinational Enterprises are the most prominent soft law regulations right now. However, since voluntary, non-binding due diligence has had a limited impact on preventing business-related human rights abuses, national legislative initiatives on the issue have increased. Apart from the new EU Directive proposal, in 2014 the UN created the Open-ended Intergovernmental Working Group on Transnational Corporations and Other Business Enterprises with respect to Human Rights (IGWG) with a mandate to develop an international legally binding instrument.  The purpose of this study is to examine the current global regulatory framework, with a specific focus on the new EU directive proposal, on corporate responsibility for human rights, and to what extent it entails legally enforceable binding responsibilities. The method used is mainly an analytical legal method and the study is based on the argument that companies currently do not have a legally enforceable social responsibility and that a new international binding regulatory framework is needed to create a generally accepted minimum standard. Clearly enforceable and internationally accepted accountability rules are needed to address the problem of corporate human rights abuses.  Furthermore, the study concludes that soft law can have an overall positive impact in preventing and holding companies accountable for human rights violations in global value chains, but that it is not enough to create the necessary change. The proposed EU Directive could achieve this, and the new EU standards could possibly even go beyond the EU in the context of global value chains and the EU's status as a policy maker. However, there are still several things to be desired about the proposed EU-directive, including the limited scope and several loopholes that have been identified.

Operating through complex supply chains and multiple jurisdictions, today’s business enterprises can outsource manufacturing to different parts of the world where they can take advantage of low labour- and production costs. In the global quest for businesses to maximise their profits, deteriorating working conditions for offshore labour workers are increasing the risks of human rights abuses. Such abuses often take the form of ‘modern slavery’, which refers to situations of exploitation in which labour workers are trapped and unable to leave due to threats, violence, deception, abuse of power or other forms of coercion. In 2015, the United Kingdom (UK) enacted the Modern Slavery Act (MSA), aimed at combatting modern slavery by requiring business enterprises to be transparent with the steps they have taken to ensure that modern slavery is not taking place within their supply chains. By putting pressure on business enterprises to display their actions taken to address adverse human rights impacts, the MSA has brought the responsibility of business enterprises to conduct ‘human rights due diligence’ (HRDD) – as stipulated in the UN Guiding Principles on Business and Human Rights (UNGPs) - into domestic law. While the MSA has been regarded as a ‘world-leading instrument’ and a ‘historic milestone’ by the UK government, its effectiveness in counteracting modern slavery has been questioned in various studies, pointing towards a risk that the MSA is allowing human rights abuses to prevail under a form of a legal veil. Bearing in mind the country’s long colonial history, the enactment of the MSA can be seen as carrying an important symbolic value for the UK when it comes to taking accountability for human rights abuses committed overseas. However, adopting weak or ineffective legislation could instead, paradoxically, reflect an interest by the UK government to maintain beneficial trade relationships based on exploitative working conditions in a manner that reflects a continuation of former colonial power structures. This thesis is set out to examine this potential paradox by analysing the MSA’s level of compliance with the UNGPs from a postcolonial perspective.