In November 2020, after several years of debate and an intense voting campaign, Switzerland narrowly rejected the adoption of the first, so-called "Responsible Business Initiative". Although the initiative was rejected, the indirect counterproposal to the initiative introducing new due diligence and reporting rules on non-financial matters in the Swiss Code of Obligations was passed and came into force on 1 January 2022.
However, the Coalition for Corporate Responsibility has now filed a new Responsible Business Initiative, claiming that the current regulation is toothless. The new initiative again seeks to establish a legal obligation for Swiss companies to assess risks and take action against potential violations of human rights or international environmental protection regulations, whether in Switzerland or abroad. The main provisions of the new Responsible Business Initiative can be summarised as follows:
- Similar to the previous initiative, Swiss companies are to be held liable for damage caused by violations of their duty of care regarding human rights and regulations on international environmental protection caused by companies under their control. They are, however, not to be liable for damage caused by their business partners.
- Unlike the first initiative, the new Responsible Business Initiative only applies to large companies. The initiative suggests a definition for large companies in line with the EU supply chain directive of July 2024 (CSDDD, i.e., companies or groups with more than 1,000 full-time employees on average and a yearly revenue of more than CHF 450 million in two consecutive financial years shall be in scope). For certain high-risk areas, companies subject to a regular audit under Swiss law should also be in scope.
- To ensure the effectiveness of the new Responsible Business Initiative, the Swiss government would have the task of enacting additional procedural provisions to enable potential plaintiffs to bring their claims against Swiss companies.
- Furthermore, a new governmental supervisory authority shall be created to ensure compliance with the new obligations by checking sustainability reports on an occasional basis, investigating breaches of obligations, and implementing mitigating measures or issuing sanctions based on group revenue.
In its press release of 3 September 2025, the Swiss Federal Council highlighted the importance for Swiss companies to respect human rights and protect the environment in their business activities, while at the same time, remaining competitive in Switzerland and abroad. The Swiss Federal Council is aware that certain amendments to the current legislation are required, particularly to ensure an internationally harmonized legislation.
Of note, the new Responsible Business Initiative is largely based on the requirements of the EU Supply Chain Directive of July 2024 (CSDDD), whereas the EU member states have since agreed on a significant easing of the provisions of this directive. Therefore, the Swiss regulation should not go beyond the future provisions of the EU and should take account of relevant international standards on due diligence and sustainability reporting.
The Federal Council intends to determine the implementation of the counterproposal once there is clarity on the direction of the future EU provisions (known as the Omnibus Directives). The draft counterproposal should be published by the end of March 2026.
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