It is fair to state that probably a large number of members of the top management of Swiss based enterprises observed last Sunday’s vote closely and took note of the fact that despite a majority of vote, the Responsible Business Initiative (the “Initiative”) was rejected. It failed due to the “Cantonal Majority” rule. If the result had been different, the Swiss lawmaker would have had to implement legislation introducing new obligations for Swiss based enterprises.
As a result, that would have meant that Swiss based enterprises would have had to implement mandatory due diligence obligations regarding the observation of human rights and environmental topics in all their business activities not only in Switzerland but also abroad. Secondly, the Initiative would have made it possible for victims of human rights or environmental violations to submit their claims for damages against such Swiss based enterprises before Swiss courts.
However, the outcome of the vote does not mean that there is no change. To the contrary, the indirect counter-proposal adopted by the Swiss Parliament on 19 June 2020 (the “counter-proposal”) will enter into force unless Swiss citizens request a vote prior to the expiry of the referendum deadline.
The most important content of the counter-proposal is the obligation of larger enterprises to publish a report on non-financial items on a yearly basis. This means that Swiss enterprises are required to disclose certain non-financial information anyway. However, the counter-proposal does not contain a liability provision.