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Blog | Tuesday May 6, 2025

The EU AI Act: Where Do We Stand in 2025?

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The European Union’s Artificial Intelligence Act (EU AI Act) is the most significant piece of legislation in the world regulating artificial intelligence. In 2024, we published a two-part series on the AI Act looking at what it means for businesses and recommendations to help companies start preparing. Twelve months on, this new blog post looks at the status of the AI Act—both in terms of provisions that have come into force and those yet to do so—as well as potential changes to the AI Act in the future. 

What is the status of the EU AI Act? 

The EU AI Act officially entered into force in August 2024; however, the provisions did not immediately apply. Instead, the legislation took a staggered approach, with different requirements coming into force at different times over a three-year period. 

The first provisions to come into effect, on February 2, 2025, prohibited certain AI practices. Most concerned more hypothetical uses of AI, rather than ones that were widespread within the EU, such as the use of AI with manipulative or deceptive techniques aimed at changing people’s behavior to cause harm, or the use of AI to predict the likelihood of a person committing a criminal offense. Many others focused on AI that might be used by government actors, including law enforcement agencies, rather than by the private sector.  

A provision that is more relevant for companies prohibits the use of AI systems to determine or predict people's emotions in workplace settings, with exceptions for safety reasons, where commercially available software that can do this already exists. In February 2025, the EU Commission published guidelines on these prohibited AI practices. These provide further clarity on all prohibited AI practices, including workplace emotional detection or prediction (e.g., clarifying that “emotions” does not include gestures, facial expressions, or whether a person might be in pain or tired). Companies using any sort of technology or software that determines or predicts people’s emotions should have stopped this already, or risk fines of up to €35 million or 7 percent of global annual turnover of the preceding year, whichever is higher. 

None of the remaining provisions are yet in force, and the next set of requirements to come into force will not do so until August 2, 2025. First, EU member states will at that point need to designate the independent organizations (“notified bodies”) responsible for assessing the conformity of high-risk AI systems before they can be placed in the EU market. 

Second, there will be new rules for General-Purpose AI (GPAI) models, namely models (like large language models) that can be adapted to a wide range of tasks. Providers will need to keep up-to-date technical documentation, provide information and documentation to downstream providers integrating models into their own AI systems, establish a policy to respect EU copyright law (particularly regarding training data), and publish a detailed summary of the content used for training. Additional, more stringent obligations will apply to GPAI models identified as having systemic risks, defined as including “actual or reasonably foreseeable negative effects on...fundamental rights.” These include requirements for model evaluation (e.g., identifying and mitigating systemic risks), assessing and mitigating possible systemic risks, ensuring adequate cybersecurity protection, and reporting serious incidents.

Third, the EU will establish an AI Office and European Artificial Intelligence Board to oversee the enforcement of the legislation, and each member state will designate a national authority with the competence to enforce the legislation at the national level.

After this, the third wave of requirements will come into force on August 2, 2026. These cover a broad range of areas, including measures to promote innovation (such as regulatory sandboxes, where innovators can test new products or services in a controlled environment under the supervision of regulators) and the establishment of an EU database of high-risk AI systems. Two requirements in particular will be important to companies. 

First, there will be new requirements on transparency aimed at ensuring that individuals are aware when they are interacting with AI. These include informing people interacting with AI systems (e.g., chatbots) that they are doing so, labeling synthetic content generated by AI (such as text, images, video or audio) as well as deepfakes, and ensuring that individuals subjected to emotional recognition or biometric categorizations are informed. These requirements will be particularly relevant for companies using emotional recognition or biometric categorizations outside of the workplace (such as in stores) or creating content using generative AI. 

Second, the AI Office and member states will encourage and facilitate the development of codes of conduct for AI systems that are not high risk. While voluntary, these will aim to encourage the adoption of similar measures that would be taken for high-risk systems, including the ethical development and use of AI, and assessing and minimizing the environmental impact of AI systems. Companies looking to position themselves as leaders when it comes to responsible AI may want to ensure compliance with these voluntary codes of conduct.  

The final requirements will come into force on August 2, 2027. These relate solely to high-risk AI systems, which include biometrics and the use of AI in critical infrastructure, education and vocational training, employment, essential private and public services, law enforcement, and the administration of justice. For these, there will be a range of requirements relating to their development, including establishing risk management systems, maintaining technical documentation, and ensuring accuracy and robustness, as well as human oversight. There are also rules relating to placing these systems in the EU market, putting them into service, and using them, such as establishing quality management systems, keeping documentation, cooperating with national authorities, and complying with conformity assessments. Part two of our series last year highlighted the many ways that the requirements for high-risk AI systems necessitated a human rights-based approach, with many of the requirements explicitly incorporating consideration of potential risks to human rights posed by the system. 

Might anything change? 

The EU has shown itself willing to modify even recently adopted regulations when faced with pressure by EU member states and other stakeholders. Notably, a range of sustainability-focused regulations are likely to be amended, limiting their applicability, scope and requirements, through the Omnibus Simplification Package. 

In recent months, there have been similar calls for the EU’s AI Act to be amended to reduce its requirements. The new U.S. administration has been critical of much of the EU’s regulation of technology given the impacts they have on U.S.-based technology companies. While the EU has not made any formal statements on whether amendments to the AI Act are planned, the EU Commission has indicated that there will be a public consultation on challenges in the Act’s implementation process, a “fitness check” on legislation in the area of digital policy, and a “simplification digital package” by the end of 2025. Depending on the outcome of the consultation and the “fitness check,” it is possible that amendments could be made to the AI Act, either removing requirements or the scope of companies who need to comply or extending existing deadlines to give more companies to prepare. 

For more information on the AI Act or to discuss its implications for your business, please contact our Tech and Human Rights team. 

Blog | Wednesday April 30, 2025

A Message from Aron Cramer, BSR President and CEO

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The world is experiencing a staggering degree of change and uncertainty right now.

Some have said that this is not no longer an era of change, it's a change of eras.

No organization amidst all of this change has all the tools that they need in their toolbox and I'm convinced that BSR is most helpful for companies when we not only bring to bear what our amazing team of almost 200 people bring, but also work within the broader ecosystem so we can bring together complimentary resources and perspectives, and networks to help companies make progress at a time of great headwinds.

Business leaders succeed when they have a sense of vision. And a vision forward, not just for 2025, but for well beyond, has to be about companies that take their impacts on society very seriously, has to take seriously the challenges that they will face if our environment does not deliver the kinds of natural resources that we need to use and need to use wisely, and ignores the intersection of business and society. Put more positively, these are all things that create massive opportunities for innovation, massive opportunities for strategic advantage, and massive opportunities to ensure resilience at a time when the change is so intense, resilience is not just a buzzword, it is an absolutely essential value that companies really need.

The best way through the current environment, which indeed is challenging, is together.

The best way through the current environment, which indeed is challenging, is together. And so, we look forward to working with you, to hearing from you, to devise solutions, figure out new collaborations, and make sense of this world together, because that has always been the way that BSR has been the most valuable and I believe it is exactly the right model for us to work towards together in this moment.

Blog | Wednesday April 30, 2025

Board Oversight Amid Uncertainty: Doubling Down on Strategic Sustainability

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Blog | Thursday April 24, 2025

Climate and Nature Integration 101: In Conversation with Helen Crowley

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Lara Birkes, Managing Director of BSR's Climate and Nature team, connected with Dr. Helen Crowley, BSR Advisor and Global Business and Biodiversity Expert, to explore why integrating climate, nature, and people is no longer optional—and how systems thinking, organizations shifts, and even nature itself can help businesses navigate complexity, build resilience, and scale impact. 

Why is an integrated approach to climate and nature important? Why does it matter, and why does it seem particularly relevant now? 

We are facing interconnected challenges—economic, societal, and environmental—that require an integrated, systems thinking approach. Historically, siloed approaches were easier, but today’s complex systems demand holistic solutions. An integrated approach is not only relevant because of the global environment, but also because it shows how single actions can deliver multiple benefits. By considering climate, nature, business, and people, we can achieve greater cost effectiveness and efficiency. 

Do you know why these disciplines have evolved separately? Could you share some context? 

The climate community took hold with clear climate science and solutions such as renewables about five years ago. However, in 2019-2020, there were discussions about how to get nature in the decision-making process. Environmental science was relatively new and had a more traditional, NGO-driven focus, whereas the climate community had already gained momentum. Over time, reports like the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services and World Economic Forum emphasized the critical role of nature, helping bring it into the broader conversation. 

Today, there is growing recognition that the entire economy depends on nature, and the focus is shifting toward integrating nature with climate action. The separation between these areas existed due to campaigning approaches and organizational structures, but now there's a push to bring them together, as it makes sense for efficiency and carries multiple benefits. 

What does integration look like from an operational and tactical perspective? What about from a product development and R&D perspective? 

Even under less than ideal circumstances, integrating nature and climate strategies is possible. 

Many companies already have separate climate, nature, or water strategies, and that’s fine. What’s important is to integrate approaches, actions, and tactics moving forward, to deliver multiple outcomes.  

If you were starting from scratch, I’d recommend developing an integrated strategy focused on building resilience and addressing both impacts and dependencies on nature and climate. Tactically, it’s key to identify where technological solutions are important, useful, and can deliver benefits. Tactics for nature-related outcomes that can also address climate issues are a crucial part of this as well. Building on existing efforts and consistently applying a nature lens to climate work will indeed make the integration smoother over time. If you're doing types of disclosure for climate-related financial risk, you can do it for nature-related risk. I know it may seem overwhelming, but build on what you have and regularly reflect: am I applying a nature lens to my climate work, or vice versa? It’s likely easier than it seems. 

The key is connecting the dots and understanding how to bring these efforts together, rather than feeling overwhelmed by the challenge. While many companies have climate strategies and targets in place, there is also a growing curiosity around nature. How do we assess what's already in place?  

I think it's fun to play around with interconnectedness. If I'm looking at deforestation, how is that tangibly addressing my climate goals? How is that tangibly addressing my nature goals, or building natural resilience or natural infrastructure? Whatever it is, however you frame it, I think you’ll find that when you start making those logical lines between the different points, it becomes clear. Embrace the complexity! 

What are the challenges and opportunities of de-siloing climate, nature, human rights, and just transition work? 

Let’s talk about the system we’re part of. For example, we hear that we’ve received US$120 billion for nature financing. We need at least US$200 billion, with an additional US$500 billion to US$1 trillion annually to counteract the negative pressures on nature.  

Yet US$7 trillion goes annually into activities that degrade nature, within a global economy of, let’s say, US$100 trillion—an economy entirely dependent on nature. This highlights a key issue: companies are under-resourced to address the complex interrelations of climate, nature, and people. There are more powerful case studies, data, and reflections emerging. We want to help build a resilient business that thrives and adapts to what is ahead. But to deliver on that, we need more resources. It’s not an intellectual challenge—we know what to do. The real challenge is securing the resources needed. This is not just about identifying what to do, but about reframing sustainability as a key part of our business growth strategy—an opportunity to push forward despite resource limitations. 

How much of this needs to be linked to a broader internal narrative, one that helps shift thinking beyond quarterly earnings and challenges the short-term mindset reinforced by our current global economic models, so that we can strike a better balance between short-term business demands and the long-term perspective required to address Earth system challenges? 

Great question. We know the system needs transforming, but it can’t happen overnight. So inside companies, it’s about taking logical steps, meeting short-term demands while embedding them in a longer-term strategy. Sometimes, that means using short-term wins as a "Trojan horse" to build momentum for deeper change. And that’s where narrative matters just as much as data: people want purpose-driven companies. Scenario planning helps too. For example, asking, "What does our business look like in a 1.5°C or 2°C world?" helps shape that longer-term perspective. 

I can imagine this may feel daunting, as if now we need to try to change the global economic paradigm—but there’s something refreshing about knowing we can start integrating these longer-term messages now, while also seeing tangible short-term action. 

As a biologist, I think there's no downside to focusing on nature. Unlike climate, which can feel overwhelming, nature is inspiring and positive. It's been around 3.8 billion years, and it has figured out a lot. Understanding nature allows for strong narratives and excitement within organizations. 

There is a growing optimism around nature, which integrates well with climate work and brings a refreshing shift in perspective.

What organizational or institutional changes do you think need to be implemented to better align climate, nature, human rights and just transition work within companies?  

Companies likely have various strategies for integration. One interesting approach has been the multiple capitals model, which uses a balance sheet to account for not just financial value, but also natural, social, and other forms of capital. There's a growing resurgence in this, especially around capital accounting. 

One of the best ways to integrate climate, nature, and people is to get into the field, whether it's a cotton field, grazing system, or mining operation. Understanding how it all works in practice allows you to build a science-based narrative. You can then focus on integrating a just transition, ensuring stakeholders are not an afterthought, and ensuring that ecosystem services are restored. Collaborating with local communities, especially indigenous peoples who steward 80 percent of the world's biodiversity, makes the whole process tangible and impactful. When making a decision, it’s important to consider whose perspectives and value systems are being included in the equation. 

The social license to operate is making a comeback, and it’s no longer just tied to mining. It’s about understanding your company’s role within the broader society and the social contract you have—not just with consumers, but with the community. It’s not just about how a company treats its employees, but also how it benefits those more broadly. When addressing nature and climate, businesses can clearly demonstrate their contribution to a broader societal value and building a sort of societal resilience. 

Shifting vantages for a moment. We both share an admiration and love for biomimicry, or learning from nature. If we were to learn from nature as practitioners of this work within companies, how would we approach integration? What can nature teach us at this important point of evolution for our work?  

Nature has been around 3.8 billion years, evolving and changing. Biomimicry describes life's principles, highlighting how nature’s resilience and power are achieved. When we talk about nature-based solutions, it’s not just a trendy term in the corporate world. It’s about harnessing nature's complexity to solve challenges it’s been addressed for millennia. By being locally attuned, building resilience, working within boundaries, and leveraging interdependencies, businesses can tap into the same strategies that have made nature so successful. Essentially, life's principles are not only key to nature’s success, but also to the success of companies seeking sustainability and resilience. 

People

Dr. Helen Crowley

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Blog | Tuesday April 22, 2025

Earth Day: Centering Health Equity in Climate Action

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Climate change presents an urgent and growing risk to companies, communities, and public health. By 2050, it is projected to result in US$12.5 trillion in economic losses and an additional US$1.1 trillion in healthcare costs. This Earth Day, as companies work on building long-term resilience in the face of climate change, it's important to consider the health of people as well as the planet.

In a recent webinar, BSR Collaborative Initiative Centering Health Equity in Climate Action (CHEC) brought its members together to share insights and real-world experiences on integrating health equity in climate action, answering five key questions on the topic below.

1. What is the climate, health, equity nexus and why does it matter?

The effects of climate change, such as rising temperatures, extreme weather events, and increasing greenhouse gas levels, lead to negative health impacts on people, including heat-related illnesses, injuries, cardiovascular and respiratory illnesses, and mental health issues.

However, climate change does not impact all people’s health equally. Vulnerable community members live in areas often hit hardest by extreme weather, do not have adequate resources to rebuild after climate disasters, and experience chronic illnesses and other health complications due to a lack of medical care, as well as social and economic inequities.

For example, as global temperatures rise, heatwaves are becoming more frequent and severe. This is leading to more heat exhaustion and heat stroke, particularly among the more vulnerable populations, such as elderly people, young children, outdoor workers, and people with preexisting conditions.

Businesses have the ability and responsibility to act and need to think about incorporating climate solutions in a way that uplifts the most vulnerable and protects public health, especially given the impacts on their workforce and long-term resilience.

2. How does the climate, health, equity nexus impact businesses?

Companies can no longer afford to overlook the factors that influence employee well-being, health, and resilience. Disparities in health outcomes, access to care, and exposure to environmental risks are already reshaping the conditions in which businesses operate.

Healthy employees are essential for business continuity, and employees depend on healthy communities and functioning health systems. Climate change is threatening all three. When climate-related health impacts affect the broader workforce community, business resilience is at risk.

These impacts disproportionately affect under-resourced communities that already face significant health disparities. The intersection of climate, health, and equity reveals that these are not separate challenges—they are interconnected systemic risks.

This also presents an opportunity. Businesses that take the lead in aligning climate action with health and equity outcomes are better positioned to withstand disruption, earn stakeholder trust, and build a more resilient operating environment.

3. What are some of the most pressing climate and health issues facing communities today?

Extreme heat, poor air quality, unprecedented storms, and vector-borne illnesses can all affect communities. Extreme heat causes dehydration, heat stroke, aggravated cardiovascular and respiratory illnesses, mental health distress, chronic disease complications, and workplace injuries. This in turn can lead to employee absenteeism, decreased productivity, and increased healthcare and disability costs.

Extreme events, such as wildfires, can result in health crises after the fires, e.g., people suffering from persistent coughs and the unknown long-term effects of pollution from burning plastic.

These examples illustrate the types of challenges that employees and their communities are experiencing. However, the specific health impacts on employees and communities vary based on local environmental conditions and the nature of climate-related changes in each region.

4. How can businesses integrate health equity in their existing climate action?

To address health equity, business can look for opportunities within existing and new climate solutions. For example, a business can implement an emissions reduction initiative as a part of its decarbonization strategy. Emissions reduction initiatives often have positive health benefits, such as reducing heat and pollution, promoting physical and mental health, and decreasing respiratory diseases in communities historically affected by industrial pollution.  Businesses can work with community organizations to identify how these health benefits can be shared equally among communities.

Companies can also consider the health impact opportunities with their respective industries. For example, travel company leaders can think critically about how tourism can support, rather than degrade, local ecosystems and economies. Construction companies can team up with building supply manufacturers to consider how to design and build healthier spaces.

Collaboration is key, and businesses need to partner with academic and community partners to find out how their climate and health initiatives can be the most impactful, and to find the people who can best implement activities quickly. 

5. What practical steps can businesses take to incorporate health equity in their climate action strategies? 

CHEC recently published a toolkit to help companies on their climate and health equity journeys. The resource demonstrates how climate change negatively impacts the health of vulnerable communities and, in turn, affects businesses, with real-life examples from CHEC members who have successfully integrated health equity into their existing sustainability initiatives.

The following four practical steps are expanded upon in the toolkit: 

1. Understand the business’ climate and health equity impacts: Begin by assessing where climate impacts from your business may have public health impacts along your value chain. It’s especially important to consider where inequitable effects on vulnerable populations may occur.
2. Start with the most impacted in your value chain: Identify the populations most affected by climate and health equity impacts within your value chain, as these are the groups for which your business holds the greatest responsibility. 
3. Measure, manage, and monitor: What gets measured gets managed. Begin by collecting data on your climate and health equity impacts and commit to ongoing measurement, management, and monitoring. With data insights, set goals based on clear insights and align them with your company’s sustainability targets.
4. Embed climate and health equity throughout your organization: Lasting change is only possible when initiatives are aligned to a business’ objectives, mission, and vision. All parties should be on board: from the board and executives to department leads and their teams.

Download the toolkit to learn more. For more information on the climate, nature, and health intersection and how BSR can support you, please contact the Climate and Nature team.  

People

Dian Grobler

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As Director of People and Culture, Dian leads BSR’s global human resources (HR) strategy, including talent acquisition, learning and development, and diversity, equity, and inclusion. He partners with senior leadership to foster an inclusive culture, ensuring employees thrive and advance BSR’s mission for a just and sustainable world. Dian also strategically manages workforce initiatives to ensure the organization consistently attracts, develops, and retains skilled professionals aligned with BSR’s long-term objectives. 

​Dian is a seasoned HR leader with extensive experience in multinational consulting and technology organizations. Specializing in the fields of people management, HR, and leadership development, he has successfully led ambitious people and culture projects across Europe, the Middle East, and Africa; North America; and the Asia-Pacific region. Dian believes strongly that people management is integral to creating high-performing teams and providing service excellence to member companies. 

Dian holds a B.A. degree in Human Resources, a B.A. Honors degree in Industrial Psychology, and a B.Psych degree in Psychometrics at the University of the Free State. Dian was awarded the HP Langenhoven and PPS prizes for outstanding academic merit for Industrial Psychology and Psychometrics respectively. Dian also holds a M.B.A. degree from the University of Cape Town Graduate School of Business. 

Reports | Tuesday April 15, 2025

Building Financial Resilience of Women Workers in the Shea Industry

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Women involved in shea collection and production face numerous challenges that limit their economic opportunities and stability—many have limited access to resources and training to enhance productivity and income, all the while having to balance unpaid work and household care. Earnings from collecting and processing shea nuts are seasonal, which can pose a challenge for financial stability. Therefore, financial resilience is key for empowering women workers in this industry.

With the support of the Estée Lauder Companies Charitable Foundation, BSR developed, piloted, and scaled a bespoke financial resilience training program to reach and empower women in shea cooperatives in Ghana. The program reached approximately 8,000 women shea nut collectors and processors and resulted in positive changes both for these women and their communities.

Notable changes include improved income management and savings, additional access to income generation opportunities, increased self-confidence, and shifts in community and family attitudes, factors that can contribute to an improvement in women’s living standards. The program demonstrates the value of investing in women workers, which not only contributes to improving their livelihoods but also builds increased supply chain resilience for buyers and partners, as demonstrated in the learnings report and toolkit presentation published here.

Following the implementation of this program, BSR launched a toolkit for organizations interested in replicating the trainings. We strongly encourage buyers, suppliers, and NGOs operating in the shea sector to use these resources to amplify financial resilience of women workers. The toolkit includes:

• Learnings Report - Read this report to learn more about the program’s background, successes, and impacts
• Toolkit Presentation - This resource walks you through how to replicate the financial resilience program, including a description of all the resources needed, as well as how and when to use them.
• Training Resources (ZIP file, 140MB) - This folder contains all of the resources you will need to coordinate and deliver the trainings from end-to-end, including the implementation guide, the financial resilience curriculum, the kick-off deck, the assessment surveys, and the radio episodes.
• Social Media Guide -  This resource provides guidance on communicating about the program outcomes and impacts on social media platforms.

Blog | Thursday April 10, 2025

Meeting the Moment Together: BSR’s Partnership with You

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I write to you, BSR members and community, in a period of staggering global uncertainty.

Many of the tenets undergirding the global economic and geopolitical order are facing historic upheaval, with the impacts being felt by all of you, the companies and organizations in which you work, as well as the communities in which you operate and live. Those of us working in sustainable business have long known that the future would bring big changes. Yet, we are now living through a time when the present is also uncertain, and in turn, our ability to see and shape the future remains equally unclear.

The foundational changes reshaping our world affect the entire sustainable business ecosystem, and the business context in general. Simply put, what has been a relatively stable international environment now faces geopolitical conflict, trade uncertainties, regulatory changes, and sudden changes in national policy priorities.  

In addition, we are seeing concerted and sometimes spurious attacks on the very legitimacy of climate action, inclusive businesses as a source of economic dynamism, and the protection of fundamental rights. All this is happening when climate change continues to accelerate, new technologies are reshaping every aspect of society, and the economy is not working for many. This presents profound challenges to our shared efforts to create resilient businesses that generate opportunities for all people to thrive and make wise use of natural resources.

We are determined to continue to pursue our mission and our work, even as we adapt to this moment. Since BSR was founded in 1992, we have seen terminology come and go, regulations and standards evolve, markets move up and down, many new technologies, and also changing political winds. We have seen exciting advances, and periods of pushback.

BSR has persevered, grown, and adapted through it all, and I am confident that our core principles—which you share—remain as relevant to business success and economic and social progress as ever.

We are here for you. In BSR, you have a steadfast and trusted partner when you need us, offering a wide variety of tools, resources, and opportunities to connect with your peers, all while staying prepared for what lies ahead. 

Meeting the Moment

Through our team of nearly 200 people, our more than 300 member companies, and dozens of partners around the world, BSR is meeting this moment in several ways.

• Our partnership with you: Our member companies are at the heart of BSR. We know you are navigating a complex array of challenges in advancing sustainable business. You may be facing increased pushback from colleagues and other internal stakeholders who are questioning the value of your work, and an external environment changing at a dizzying pace. We are here for you. In BSR, you have a steadfast and trusted partner when you need us, with a wide variety of tools and resources to help you address these issues, while being prepared for what’s around the corner. Don’t hesitate to call us.
• Understanding the changing policy and regulatory environment: Our team is here to help you make sense of the rapid, volatile, and evolving regulatory context for sustainable business. We are tracking developments on key frameworks in Europe, the U.S., and Asia. We also are tapping into legal and other expertise outside BSR, and we are creating multiple spaces—virtual and in person—for you to discuss this changing context with other BSR members. While BSR does not provide legal or compliance advice, our team brings considerable expertise based not only in their time at BSR, but in their prior roles in the worlds of law, policy, standard setting, and international agencies.
• Developing strategic foresight: The intense changes in the present, in our view, reinforce the need to see past current developments and understand and design resilient futures. Our Sustainable Futures Lab considers long-term trends and scenarios and indeed anticipated many of the global challenges we now face. Given the degree of short-term volatility, our team is adding a focus on short-term, rapid simulations, helping companies prepare for how to handle contingencies and conflicts between their short-term circumstances and long-term business value and principles.
• Building powerful partnerships: BSR has recently enhanced our capabilities to serve members in partnership with other experts. For example, we increasingly work in collaboration with law firms to combine legal guidance (and protections) with sustainability strategy. We also partner with technical experts in areas such as nature and carbon.
• Reframing the sustainability narrative: We know that many of you are taking this opportunity to reframe the way sustainable business is understood and communicated. While some of this comes from a response to challenges, we also see an opportunity to underscore the business value of sustainability, and to communicate in ways that reach customers, employees, and the public in a more compelling way. We are in dialogue with many of you, as well as other partners and experts, to develop compelling narratives that break through in a challenging time, and to work with you to craft language that works in your company, in this time.

Staying True to Our Purpose

Even as we adapt how we support you and all our member companies; we are doubling down on the characteristics that make BSR unique and help us deliver impact.

• We are a mission-driven business organization: We remain dedicated to the same mission we have had since 1992: to work with business to create a just and sustainable world. We pursue this mission consistent with our principles and with attention to a wide range of stakeholders and a focus on real world impacts.
• We exist solely to support sustainable business leaders: We are here to support sustainable business leaders as they advance progress inside their companies. We work extensively with sustainability teams, and also with business functions and leaders in other areas. We recognize that different companies may take different pathways, and we support companies in ways that are true to their purpose, priorities, and culture.
• Our diversified organizational model creates multiple pathways for our members to achieve their goals. We operate a highly diversified organizational model crossing geographies, industries, and topics.  We support you through member service, insights, one-on-one advice, collaborative initiatives, as well as projects we can support through foundation grants. This model has long been a source of resilience and diverse opportunities for companies to take full advantage of their relationship with BSR.
• We bring diverse expertise to our work with you: BSR serves you by leveraging our team, which brings a rich mix of experience—they are former in-house sustainability leads, management consultants, business unit and functional leaders, and lawyers. Our team also brings experience from civil society and the public sector, with expertise in human rights, climate and nature, inclusion, strategy, reporting, and many other areas. As our colleague Christine Diamente, former CSO at Alcatel-Lucent and Nokia, notes, “I spent 20 years in the same seat as our members. I try to bring that experience to every conversation—helping sustainability leaders to navigate internal challenges and seize opportunities.”

The stakes for people and the environment grow larger and more urgent every day, and the companies that embrace the opportunity to maximize their positive impacts will generate success, resilience and trust.  Some organizations may be pulling back, and while we are sympathetic to the pressures that many face, BSR isn’t going anywhere. We have always sought to be a leader in sustainable business and a trusted, honest partner to our members, and our work continues full force.

When COVID-19 erupted five years ago this month, I called out the need to “meet the moment and build the future.” This remains crucial. Our particular moment is delivering novel, significant challenges. We cannot underestimate them, and we must rise to the occasion. It is also up to us to build the future we all envision: one in which everyone can thrive, and we preserve the glorious and essential natural world. At a time when that future can seem distant; we cannot and will not retreat from the need to make it a reality.

Blog | Wednesday April 9, 2025

Integrity in a Permacrisis: Maintaining Sustainability and Human Rights Principles as Supply Chains Upend

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Updated on June 25, 2025 to highlight implications of recent U.S. trade policy changes on the energy, extractive, transportation, and industrial sectors. 

Global supply chains offer plenty of opportunities for companies to innovate with their products, support local economies, and build lasting relationships across countries. However, amidst a confluence of COVID-19, wars, trade route disruption, reliance on fossil fuel-based energy, amplifying extreme weather events, aging infrastructure, social unrest, increased migration and backlash, and heightened areas of human rights impacts, we are now facing an era where supply chains are now in a permacrisis that’s growing more complex by the day.

On April 3, the U.S. Administration announced trade policy changes that will take effect in April and May 2025 with the potential to upend global supply chains. These measures involve:

1. Broad tariffs on global imports to the U.S. 
2. The elimination of duty-free de minimis treatment for low-value exports from China and Hong Kong to the U.S.

Tariffs act as a tax on imported goods, raising the price for domestic buyers of foreign products as these become more expensive than locally produced alternatives. While it remains to be seen what will emerge from the negotiations process, other countries are beginning to respond to U.S. tariffs with their own retaliatory import tariffs on the U.S.

Implications for Companies and Sustainable Business

The tariffs announcement leaves global supply chains in a state of disarray, as companies rapidly prepare for reconfiguration of their supplier relationships. On the same day, the European Parliament voted in a landslide in favor of the stop-the-clock part of the Omnibus proposal. Together, these two announcements place significant pressure by driving up the cost of doing business while reducing the incentives for companies to operate responsibly. 

Some of the envisioned implications for sustainable business are:

• Growing supply chain uncertainty as companies are not clear on import costs nor which countries or commodities may be targeted. ​
• A possibility of cascading protectionist policies in economies around the world, leading to increased cost of living and affecting the most vulnerable populations the most.
• Greater inefficiencies in supply chain and sourcing as companies may need to change import markets, which may be farther away. This is expected to impact the overall cost, delivery times, product availability in stores and credit lines, as well as sustainability initiatives, such as efforts to reduce environmental impacts of purchasing practices (e.g., incurring a higher carbon footprint from longer distances).​
• Threats to responsible sourcing programs, as companies may face tensions between the need to onboard new suppliers quickly while maintaining strong due diligence practices upfront. ​
• Responsible disengagement practices that consider implications on workers, as companies may need to reduce purchasing or terminate relationships with foreign suppliers if costs of goods become too high. ​
• Higher costs of production might threaten existing sustainability initiatives. As companies look to reduce costs, there may be reduced investment in living wages, a resort to cheaper and riskier migrant and child labor (especially with weakening child labor protections in certain states), or other labor-related issues that require capital expenditure.​
• Changes in consumer spending as prices of goods change. In the short term, consumers may stop buying higher priced goods, which can result in food waste and impact company profits and sourcing strategies. In the long term, consumers may adopt more local purchasing, with potential positive impacts on sustainability. ​
• Increased use of and higher reliance on Artificial Intelligence.

Recommendations for Business

BSR urges companies to work closely with their suppliers in finding solutions to the increasing complexities, look at the existing relationships from a partnership perspective, continue conducting thorough due diligence, and practice responsible entry and exit. To build supply chain resilience, whilst minimizing negative impacts on sourcing communities in this upheaval, companies can:  

• Gauge how your suppliers are affected. Develop contingency sourcing and sales strategies for at-risk commodities early, allowing sufficient time to incorporate sustainability considerations (e.g., responsible disengagement, appropriate due diligence processes, etc.) together with most trusted suppliers.
• Invest in a rapid supply chain and transportation channels mapping to evaluate reliance on imported commodities into the U.S. and identify primary regions of import.
• Understand reliance on replaceable versus non-replaceable commodities, particularly those imported from regions at risk of tariffs, and explore options for alternatives.​ Conduct rapid human rights due diligence to anticipate and management resulting implications for people.
• Follow OECD Guidelines for Multinational Enterprises and the UN Guiding Principles on Business and Human Rights (UNGPs) in entering, modifying, and exiting existing relationships.

How BSR Can Support​

• Responsible Disengagement: The BSR Human Rights team can assist in developing strategies for responsible disengagement from suppliers in circumstances where tariffs may lead to contract termination. ​
• Governance: We can provide guidance for your company on how to ensure governance structures are robust and incorporate consideration for impacts of tariffs on sustainability initiatives. ​
• Identify and Assess Human Rights Impacts: Identify and assess human rights impacts stemming from emerging landscape changes as part of a company's human rights due diligence process. BSR can support companies with rapid due diligence processes to inform complex sourcing decisions with human rights considerations. Using a modular approach to human rights assessments, we can support on everything from a high-level scan to a more intensive impact assessment involving extensive stakeholder engagement.
• Futures Scenarios: The BSR Futures team can help brainstorm different impacts of tariffs specific to your company.​
• Navigating with Peers: We convene companies facing similar pressures in sourcing regions and markets to collectively digest implications and learn from each other's approaches.

In these turbulent times, navigating the complexities of global supply chains requires proactive collaboration, foresight, and a steadfast commitment to responsible practices. Contact us to learn more about how BSR’s team can support your company across the supply chain.