TERMS OF REFERENCE

Joint High-Level Event by German Embassy, GIZ and UNDP

“Responsible Business Conduct along Global Supply Chains – The German Supply Chain Act and its
implications for Indonesia”

31.05.2023, Le Méridien, Jakarta

Background

Starting point and reference for the German Supply Chain Act are the UN Guiding Principles for
Business and Human Rights (UNGP) endorsed unanimously in 2011 by the UN Human Rights Council.
All states were called to implement the UNGP through different measures across a wide range of policy
fields. So far, 30 States have adopted Action Plans for UNGPs implementation.

The adoption of the German Supply Chain Act in 2021 is a direct consequence of these implementation
efforts. It constitutes a milestone for a more effective protection of people and the environment in
global supply chains. For the people working in supply chains, the law means better protection of their
social rights and, consequently, increased participation in global economic growth. For companies, the
law provides a clear legal framework and creates legal certainty. It is a good compromise between
effective protection of human and certain environmental rights locally, and feasibility of
implementation in German companies.

The law covers all economic sectors and stipulates vigilant monitoring, strict sanctions and due
diligence obligations along the entire supply chain. All of this makes it the strongest supply chain act
that currently exists worldwide. Initially, starting in 2023, the law will apply to companies with more
than 3,000 employees; from 2024 onwards, it will apply to companies with more than 1,000
employees. In adopting this law, Germany has issued for the first time binding regulations on
mandatory steps for companies in order to ensure compliance with internationally recognised human
rights. More and more countries follow this example by developing similar legislation (e.g. France, UK,
Australia, the Netherlands, EU, Norway, Switzerland, the U.S., and Canada).

General objective of the event

The overall objectives of the event is to enhance networking among stakeholders from governments,
civil society and business in Indonesia to facilitate a better understanding of the German law and its
implications. Furthermore, the event strives to provide an opportunity to discuss challenges and co-
create solutions to safeguard human rights along the entire business supply chain of German and
Indonesian companies. Finally yet importantly, the event is an appropriate platform to display the long-
standing tradition for sustainability and human rights of German companies.
Specific objectives of the event

The event will be half-day and split into two major panel discussions that will highlight different
perspectives on the German Supply Chain Act, the planned EU Supply Chain Act and the Indonesian
engagement in the field of Business and Human Rights. The specific objectives of the panel are as
follows:

Panel 1: German Supply Chain Act – brief expert overview

 to inform about the new regulatory framework that is set by the law
 to give background on the genesis of the law by policymakers from Germany
 to give an outlook on the upcoming EU Due Diligence Directive
 to share the Indonesian perception on the new laws and display the government’s
engagement in the field of Business and Human Rights

Panel 2: Business and Human Rights Agenda in Indonesia

 To share best practices/innovations of business stakeholders

 To match make between business stakeholders and international development cooperation
partners
 To advocate for an economic environment that integrates the international Business and
Human Rights frameworks
 To support companies and their suppliers in establishing management structures and
measures for the control of their supply chains

Participants

The German Embassy, GIZ and UNDP act as co-hosts of this high-level event. We join our efforts to
support companies in the implementation of new regulatory frameworks on Business and Human
Rights. We are fully committed to enhancing human rights protection in the business context. Through
our wide networks in Indonesia, we expect participants from business sector, governments, civil
society, embassies and academia to join the event. The number of participants will be limited to
approx. 100 persons.