The German Supply Chain Act, also known as the Lieferkettensorgfaltspflichtengesetz,(LkSG) is a new law that came into effect on January 1, 2023. The aim of the law is to ensure that companies operating in Germany take responsibility for human rights and environmental standards throughout their global supply chains.

Under the law, companies with more than 3,000 employees will be required to conduct due diligence checks on their suppliers, both in Germany and abroad. This includes checking that their suppliers are adhering to human rights standards, such as the prohibition of child labor and forced labor and ensuring that their operations do not cause environmental harm.

Companies will be required to report publicly on their supply chain due diligence measures, and failure to comply with the law could result in fines of up to 2% of a company's annual turnover.

The law is expected to have a significant impact on a range of industries, including textiles, electronics, and agriculture, where human rights abuses and environmental damage have been reported in the past. The supply chain refers to both products and services. While it may increase compliance costs, legal and reputational risks, it also represents an important step forward in promoting sustainable and responsible supply chain practices.

Overall, the German Supply Chain Act represents a major step forward in ensuring that companies operating in Germany are held accountable for their actions throughout their supply chains, and that the rights of workers and the environment are protected.

The MHP LkSG Power BI Tool is an add-on for Microsoft users, to support LkSG activities. It offers the following functions:

Assessing and visualizing risks through a Power BI dashboard, risk score, reporting and alerting
Tracking of remedial actions in the event of a risk occurring in a Power BI Dashboard
LkSG specific supplier questionnaires incl. certificate upload
Document storage and upload of supplier and company-specific data, including visualization through map via Power BI Dashboard

MHP LkSG Power BI Dashboard: 4-Day Workshop

MHP Management- und IT-Beratung GmbH

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