Strengthening ESG and Supplier Due Diligence in Europe: Lessons from the SGS-EcoVadis Partnership

In Europe, companies face increasingly stringent requirements for environmental, social, and governance (ESG) compliance. Recent developments, such as the expanded partnership between SGS and EcoVadis, provide a blueprint for organizations seeking to strengthen supplier due diligence and achieve credible ESG verification.

SGS and EcoVadis: A Closer Look

SGS has joined EcoVadis as an accredited auditing partner, providing:

• On-site audits and follow-up training for suppliers flagged in sustainability assessments.
• Integration with EcoVadis’ Worker Voice program to capture anonymous employee insights.
• Support for remediation and ongoing compliance tracking across the supply chain.

This collaboration allows European companies to move beyond self-reporting, enabling risk verification and corrective action in line with EU regulations.

Why Supplier Due Diligence Matters

Under the EU Corporate Sustainability Due Diligence Directive (CSDDD), companies must:

• Identify and mitigate human rights, environmental, and governance risks in their supply chains.
• Monitor suppliers and ensure that corrective measures are implemented effectively.
• Provide transparent reporting to regulators, investors, and stakeholders.

The SGS-EcoVadis model strengthens due diligence by combining risk assessment with independent verification and remediation follow-up, essential for compliance with EU law.

Practical Steps for Estonian and European Companies

1. Integrate ESG risk screening with independent verification – flag high-risk suppliers and validate findings through audits.
2. Plan for remediation and continuous monitoring – ensure corrective measures are tracked and effective.
3. Engage credible third-party auditors – SGS’ global audit network exemplifies robust verification capacity.
4. Align with regulatory developments – CSDDD and other EU ESG frameworks are raising the bar for responsible sourcing.
5. Use transparency as a competitive advantage – companies demonstrating strong due diligence attract investors, customers, and partners.

What Suppliers Should Know

Suppliers in Estonia and across Europe should prepare for:

• Enhanced scrutiny through audits and surveys.
• Demonstrating continuous improvement rather than one-time compliance.
• Proactive engagement with buyers to ensure transparency and corrective action.

Conclusion

The SGS and EcoVadis partnership illustrates the evolution of ESG compliance from disclosure to verification. For European companies, especially in Estonia, the message is clear: robust supplier due diligence is no longer optional — it is essential for regulatory compliance, risk management, and sustainable business growth.

Posted on: 30 October 2025
Category: ESG & Supplier Due Diligence