The law on the corporate duty of care to prevent human rights violations in the supply chain and to comply with environmental standards.
What the LkSG requires
The Act on Corporate Due Diligence Obligations in Supply Chains (LkSG), which entered into force on 1 January 2023, provides a legal framework for companies to manage their supply chains in a more responsible and sustainable manner. This Act imposes significant responsibilities on companies, particularly with regard to respect for human rights and environmental sustainability. Companies are obliged to ensure the protection of human rights and compliance with environmental standards in their supply chains. This obligation is not limited to direct suppliers alone, but covers every stage of the supply chain.
Under the LkSG, companies must regularly assess the risks in their supply chains and develop effective policies and procedures for preventing and remedying violations. Furthermore, ensuring the transparency of these processes and establishing effective communication with all stakeholders is also of great importance.
Particularly in view of the complexity of global trade and supply chains, this Act may be regarded as an opportunity for companies to improve their operational and ethical standards. By establishing sustainable and ethical supply chains, companies both fulfil their legal obligations and strengthen their corporate reputation.
Who is in scope: timetable and thresholds
The Act entered into force in stages; since 1 January 2024 it has covered companies with 1,000 or more employees.
| Entry into force | Applies to | Company size |
| 1 January 2023 | Companies domiciled in Germany and companies that have a second branch pursuant to Section 13 d of the German Commercial Code (HGB) | Companies with at least 3,000 employees in Germany |
| 1 January 2024 | Companies with at least 1,000 employees in Germany |
The text of the Act and its Turkish translation
You can find the official text of the Act here: Gesetz über die unternehmerischen Sorgfaltspflichten in Lieferketten
You can find the Turkish translation of the Act here:
What this means in practice for Turkish suppliers
The practical consequence for Turkish companies is this: although the LkSG does not apply directly in Türkiye, German customers within its scope pass their obligations down to their suppliers by contract. A company supplying goods or services to Germany is now routinely asked to sign a code of conduct, complete a self-assessment questionnaire, accept audits and report breaches.
Steps a supplier can take to prepare
The steps that leave a supplier prepared for those requests are well established: put in place a written policy and code of conduct covering human rights and environmental matters; carry out a simple risk assessment that also covers your own suppliers; set up a complaints channel your employees can reach; keep proper records on occupational health and safety and on working conditions; and have the due diligence clauses in customer contracts reviewed before you sign them. As the threshold fell to 1,000 employees on 1 January 2024, more German companies came within scope, so suppliers that have done this preparation hold a clear advantage of trust in their commercial relationships.
