CSDDD: What the EU Directive Means for Music, Media and Entertainment

The Corporate Sustainability Due Diligence Directive, known as CSDDD or CS3D, is one of the most significant pieces of sustainability regulation the European Union has produced. It places legally binding due diligence obligations on large companies operating in the EU, requiring them to identify, prevent, and address adverse human rights and environmental impacts across their entire value chains.

For businesses in music, media and entertainment, the CSDDD deserves serious attention. Even companies that do not meet the direct thresholds may find themselves inside the scope of the directive as suppliers to those that do. Understanding what the directive requires, and when, is no longer optional planning. It is operational preparation.

What Is the CSDDD?

The CSDDD is an EU directive that entered into force in July 2024. It requires large companies to conduct ongoing due diligence on their operations, subsidiaries, and supply chains to identify and mitigate risks to human rights and the environment.

Unlike voluntary frameworks or disclosure standards, the CSDDD carries legal weight. Companies that fail to comply face civil liability and financial penalties enforced by national supervisory authorities in each EU member state. Compliance is not a reporting exercise. It is a structural requirement with legal consequences attached.

The directive covers two broad categories of harm: adverse human rights impacts, such as forced labour, unsafe working conditions, and violations of labour rights; and adverse environmental impacts, including pollution, biodiversity loss, and greenhouse gas emissions. Both categories must be addressed across the full value chain, not just within a company's own operations.

Who Does the CSDDD Apply To?

The directive applies in two phases, each with different thresholds.

From 2027, it applies to EU companies with more than 5,000 employees and a worldwide net turnover above EUR 1.5 billion, and to non-EU companies with a net turnover above EUR 1.5 billion generated in the EU.

From 2028, it extends to EU companies with more than 1,000 employees and a net turnover above EUR 450 million, and to non-EU companies with a net turnover above EUR 450 million generated in the EU.

These thresholds are significant. Many companies in music, media and entertainment will not meet them directly. But this is where a common misreading of the directive creates risk. Companies that sit below the thresholds will still face due diligence scrutiny as suppliers, partners, and contractors to in-scope businesses. If a major broadcaster, a global streaming platform, or a large live event conglomerate is subject to the CSDDD, that obligation flows into how they select and manage their supply chain. Being below the threshold does not mean being outside the directive's practical reach.

What Does Due Diligence Mean in Practice?

The CSDDD defines due diligence as an ongoing process, not a one-time audit. In-scope companies must:

Integrate due diligence into their policies and risk management systems. This means having a written due diligence policy that covers human rights and environmental impacts, updated annually, and communicated to employees and business partners.

Identify actual and potential adverse impacts. Companies must map their value chains and identify where adverse impacts occur or could occur. For large, complex businesses in entertainment, this includes everything from the supply chain behind merchandise and physical media to labour conditions in production and touring.

Prevent, mitigate and remediate impacts. Identifying a risk is not sufficient. Companies must take action to prevent potential impacts from materialising, mitigate actual impacts that are already occurring, and provide remediation where harm has already been caused.

Establish and maintain a complaints procedure. Affected persons, including workers in the supply chain, must have a mechanism through which they can raise concerns about adverse impacts.

Monitor the effectiveness of due diligence measures. Companies must carry out periodic assessments of their own operations and those of their business partners to verify that due diligence measures are working.

Communicate publicly on due diligence. In-scope companies will be required to report on their due diligence activities, feeding into the broader transparency requirements already established by the Corporate Sustainability Reporting Directive (CSRD).

The CSDDD and Climate Transition Plans

One of the most operationally significant elements of the CSDDD is its climate transition plan requirement. In-scope companies must adopt and implement a transition plan for climate change mitigation that is compatible with the Paris Agreement goal of limiting global warming to 1.5 degrees Celsius.

This is not a disclosure obligation. It is an implementation requirement. Companies are expected to act on their transition plans, not simply publish them. For businesses with significant carbon footprints from touring, production, streaming infrastructure, or broadcast operations, this places the transition plan at the centre of strategic decision-making.

The requirement aligns with the Science Based Targets initiative (SBTi) framework, which provides methodology for setting emissions reduction targets consistent with a 1.5 degree pathway. Companies that have already adopted SBTi targets will be better positioned to demonstrate compliance with this element of the directive. Companies that have not should treat this as a prompt to start.

What This Means for Music, Media and Entertainment

The CSDDD creates concrete obligations for the sector, even where direct thresholds are not met.

For major broadcasters, streaming platforms and content studios: If your EU turnover meets the thresholds, you are directly in scope. That means supply chain mapping, formal due diligence processes, a complaints mechanism, and a climate transition plan with implementation evidence. These are structural changes, not reporting additions.

For live music and events businesses: Large promoters and venue groups that meet the thresholds face the same requirements. Beyond that, they must look carefully at the labour practices of their contractor networks, the environmental performance of their production and logistics suppliers, and how they document and address risk across the event supply chain.

For music labels, publishers and management companies: Many will sit below the thresholds but will face downstream pressure from partners and clients who are in scope. Demonstrating strong human rights and environmental performance is increasingly a commercial prerequisite, not a market differentiator.

For independent businesses across the sector: Even where the CSDDD does not apply directly, the regulatory direction of travel is clear. The EU is embedding sustainability obligations into commercial law. Businesses that build the systems and practices now will be better placed when future thresholds are lowered, when procurement requirements evolve, or when investor and audience expectations shift accordingly.

The Relationship Between the CSDDD and the CSRD

The CSDDD and the Corporate Sustainability Reporting Directive (CSRD) are distinct instruments, but they are designed to work together. The CSRD governs disclosure, requiring large companies to report on sustainability impacts using the European Sustainability Reporting Standards (ESRS). The CSDDD governs conduct, requiring those same companies to take action.

In practical terms, a company's CSRD reporting will need to reflect the due diligence activities required by the CSDDD. The two frameworks share concepts, including the principle of double materiality, which requires companies to assess both how sustainability issues affect the business and how the business affects people and the planet.

Understanding both frameworks together is essential for any business trying to navigate EU sustainability regulation coherently.

Getting the Foundations Right

The CSDDD rewards businesses that treat sustainability as a structural matter rather than a communications function. Due diligence cannot be retrofitted onto existing operations at reporting time. It has to be embedded into procurement, supplier selection, contract management, risk governance, and strategic planning.

For music, media and entertainment businesses, that means starting now. The phased implementation timeline gives in-scope companies a window, but the practical work of supply chain mapping, policy development, stakeholder engagement, and climate planning takes time. Companies that leave it to the compliance deadline will be under-resourced and exposed.

Hope Solutions works exclusively with businesses in music, media and entertainment on sustainability strategy and compliance. Our team brings sector-specific knowledge of the regulatory landscape alongside operational experience in how these businesses actually run. If you need to understand what the CSDDD means for your business specifically, or how to build the systems required to meet it, we can help.

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