LkSG Preventive Measures
Preventive measures under the German Supply Chain Due Diligence Act (LkSG) are precautions through which companies prevent or minimise human rights and environmental risks within their own operations and at their direct suppliers.
Preventive measures are a central element of the graduated due diligence obligations under the German Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz, LkSG). They follow directly from the risk analysis: wherever a company has identified human rights or environmental risks, it must take appropriate and effective precautions to avoid those risks or at least minimise them. Unlike remedial measures, which only take effect after a violation has already occurred, preventive measures act ahead of time and are intended to stop violations from arising in the first place.
The Act distinguishes between measures within a company's own business area and those directed at direct suppliers. Within its own operations, these include anchoring the human rights strategy in the relevant business processes, developing and implementing suitable procurement and purchasing practices, and training in the affected business areas. Towards direct suppliers, they include factoring human rights and environmental expectations into supplier selection, obtaining contractual assurances of compliance, providing training and further education, and agreeing on risk-based control mechanisms.
Preventive measures must be designed in proportion to the risk: the nature, scope and probability of the violation, the company's contribution to causing it, and its ability to exert influence determine which precautions are required. Their effectiveness must be reviewed at least once a year and on an ad hoc basis, and updated where necessary. The measures must be documented and presented transparently as part of the reporting obligation to the German Federal Office for Economic Affairs and Export Control (BAFA).
Legal Basis
Section 6 LkSG (preventive measures); Section 4 LkSG (risk management); Sections 3, 5 LkSG
Practical Example
A mid-sized textile importer has identified, in its risk analysis, elevated risks of forced labour and inadequate occupational safety at sewing workshops in two sourcing countries. As a preventive measure, management adopts a policy statement on respecting human rights, includes binding human rights and environmental clauses in all supplier contracts, and obliges direct suppliers to undergo annual training as well as announced and unannounced audits. In addition, procurement adjusts its ordering practices to avoid unrealistic delivery deadlines that encourage excessive overtime. The compliance function documents all measures and reviews their effectiveness once a year.