Corporate Sustainability in Chile: Human Rights Due Diligence

Sustainability as a model of business and economic integration has been promoted for decades, and has recently gained some momentum, with companies being required to integrate the three key aspects into their activities: economic, environmental and social. It is no longer enough for companies to merely comply with the regulatory framework of the places where they operate; they are now compelled to integrate environmental protection and respect for human rights into their activities.

While human rights in business were once promoted as voluntary standards or non-enforceable initiatives, the legal framework has now changed. Both international organisations and certain states, mainly in Europe, have enacted various regulations that directly oblige companies to identify, mitigate and remedy their negative impacts on human rights. These impacts include both direct and indirect effects, as well as those coming from business partners and supply chains. Although this discussion seemed distant for the Chilean legal industry, the reality is that these obligations are already present, mainly through contracts. Likewise, different bills are currently being discussed in the National Congress that seek to establish the same obligation of due diligence in human rights for Chilean companies.

In consideration of the above, this article will first outline the international and comparative legal experience on business and human rights, before identifying the main advances that Chile has made in this area and noting the current and future changes that will be experienced, as well as the regulatory risks involved. Finally, considering the debate and possible regulatory changes, some recommendations will be proposed for companies to reaffirm their commitment to sustainability.

Business and human rights: familiar debates with new solutions

The idea of holding companies accountable for negative human rights impacts is a long-standing debate in international law. Since the 1970s, there have been attempts to enact codes of conduct on the subject, with varying degrees of success. Undoubtedly, the greatest consensus was achieved in 2011, when the United Nations (UN) enacted the Guiding Principles on Business and Human Rights (UNGPs). While this instrument is not an international treaty, it is the standard of reference and launched the concept of human rights due diligence (HRDD).

Broadly speaking, due diligence requires corporations to undertake the following activities:

• issue a policy commitment;
• identify and mitigate the negative impacts of their activities on human rights;
• have grievance mechanisms in place;
• make their impacts transparent; and
• in case of breach, to remedy and compensate the victims.

One may also note that the obligation to implement HRDD has been highlighted by international courts – eg, the Inter-American Court of Human Rights (IACtHR). For example, in the case of Inhabitants of La Oroya v Perú, the IACtHR ordered the state to ensure that a mining company complies with the UNGPs throughout its projects.

In the face of ongoing international debate and questions about the enforceability of their standards, some states have enacted laws that directly require their companies to implement HRDD throughout their supply chain. In 2017, France amended its Commercial Code and now requires a devoir de vigilance (vigilance duty) for a large percentage of French companies (Loi de Vigilance, 2017). Germany followed suit and enacted a law requiring HRDD for companies operating on its territory (Lieferkettensorgfaltspflichtengesetz, 2021). Notwithstanding their differences, both laws establish penalties, through either tort law or administrative sanctions. However, the big shift came in 2024, when the European Union (EU) enacted its Directive 2024/1760 on Corporate Sustainability Due Diligence (CSDDD). Within two years of its enactment, member states will have to transpose these rules into domestic law.

Outside Europe, Australia has enacted modern slavery regulations, like HRDD, at federal and state levels. In this case, Australian companies – which are competitors with Chilean companies in markets like mining – are already familiar with these standards.

Lastly, it is worth recalling Chile's membership of the Organisation for Economic Co-operation and Development (OECD), having become the first South American state to become a member of the organisation, in 2010. The OECD has enacted several instruments on corporate sustainability, with the main one being the Guidelines for Multinational Enterprises. This originated in the 1970s but has been continuously revised (eg, to conform to the UNGPs); its latest revision was in 2023, when it was renamed the Guidelines for Multinational Enterprises on Responsible Business Conduct. Moreover, in its diagnostics, the OECD has highlighted that the greatest challenges and developments have taken place in the extractive industries – eg, mining and agriculture. To comply with OECD standards, Chile has implemented its National Contact Point (NCP) for Responsible Business Conduct. These are spaces for dialogue to resolve differences, where the NCP seeks to contribute through dialogue between the actors and stakeholders involved.

Corporate sustainability in Chilean law

The issue of business and human rights has been addressed in a mixed way by the legislature and public agencies in Chile. Chilean law does not have a particular regulation or law on corporate sustainability, nor does it require companies to implement HRDD in their operations. Instead, what can be observed are advances in specific areas in consideration of the aspects that define sustainable development.

In the corporate case, General Rule No 461, enacted in 2021 by the Financial Market Commission, is worth noting. It sets the rules on sustainability standards for corporate governance in the annual report of listed companies subject to its supervision. In this regard, it requires companies to report whether they adhere to the UNGPs and how they implement a human rights approach in their governance structure.

In environmental matters, the 2023 enactment of Law No 21.595 on Economic Crimes is worth highlighting, in addition to the bills under discussion that seek to reform environmental institutions. This law creates a system of economic and environmental crimes, and modifies the statute of criminal liability of legal persons, with the aim of criminally prosecuting companies and those responsible. Furthermore, the Superintendence of the Environment (SMA) has published an annual report on human rights in 2024 and 2025, which addresses how the public agency implements Chile's international environmental and human rights obligations in its discipline and punishment tasks.

In social areas, some labour reforms are worth highlighting, including the 2024 enactment of Law No 21.643, which seeks to guarantee safe and harassment-free workplaces, and to prevent acts that are contrary to this objective.

In sum, there is no general law in Chile that establishes a direct obligation for companies to implement HRDD. However, through decrees issued by the President of the Republic, some steps have been taken in business and human rights. In 2017, the Committee for the National Action Plan (NAP) on Business and Human Rights was created, which is integrated by different ministries with the objective of advising the President of the Republic on the topic and creating and monitoring compliance with the NAP.

While NAPs do not establish new obligations, they are instruments through which the government promotes certain public policies and assesses the social climate for regulatory change. To date, Chile has enacted two NAPs on Business and Human Rights. The first NAP was enacted in 2017 by the Under-Secretary of Foreign Affairs and lasted for three years (2017–2020). Its purpose was to develop a culture of respect and promotion of human rights in business in different industries, and to bring the discussion to the domestic level, as established in the UNGPS.

The second NAP was enacted in 2022 by the Under-Secretary of Human Rights, also for a three-year period (2022–2025). It sought to deepen the conversation inaugurated by its predecessor and to establish new and more ambitious actions. The third NAP is currently under discussion, and seeks to outline public policy in this area for the period 2026–2029. This instrument seeks to deepen collaborative work in its elaboration and includes the different stakeholders and actors impacted positively and negatively by business activities.

Regulatory risks: bills on human rights due diligence

Along with the pragmatism and non-enforceability that characterise the NAPs, it is worth noting that the debate has highlighted the need to include autonomous public agencies and for the National Congress to articulate the NAPs with regulations and bills. This is not the result of chance; rather, this need for co-ordination arises from a series of bills currently under discussion that, with different nuances, seek to require companies to implement HRDD.

First, Bill No 17.196-17, presented in October 2024, seeks to amend the law on joint stock companies to establish obligations for such corporations to promote the protection of human rights. This bill is based on the regulatory model of the EU CSDDD and seeks to oblige certain companies, depending on their size and corporate form, to implement the various steps and tasks set out in the HRDD in their activities. Of course, this includes having a policy commitment, as well as the task of identifying, assessing and mitigating negative human rights impacts on their stakeholders.

The second bill is No 17.446-17 and was introduced in April 2025. With only two proposed articles, the bill seeks to require large companies, based on their capital and number of workers, to implement due diligence on compliance and respect for human rights, the environment and climate change. The bill requires corporations to prepare an annual report on their compliance with these obligations and subsequent reporting to the authority. In terms of implementation and regulation, the draft law relies on the Ministry of Justice and Human Rights.

The third bill is No 17.520-17 and was presented in May 2025. This bill has four titles and seeks to establish a comprehensive and general regulatory framework to promote HRDD for companies operating in Chile. As in previous drafts, the regulation seeks to be applicable to corporations according to their size. In its first title, it establishes the bases and objectives of the regulation, which is framed in the UNGPs and in the international treaties signed and ratified by Chile on the matter. Its second title refers to the obligations of companies and is divided into obligations common to all corporations subject to the law and obligations only applicable to large ones. The third title focuses on the mechanisms for public complaints against non-compliant companies. Finally, the fourth title establishes the sanctioning regime, including fines for offending companies.

Despite the differences and similarities between the bills, as well as the fact that they are in the early stages of legislative discussion in the National Congress, the truth is that HRDD is a discussion from international and comparative sources that has come to Chile to stay. Companies are increasingly exposed to these requirements, and their successful implementation is key to developing a business model that is sensitive to the demands of the market and the public.

The recommendation: look to the future, with a preventative approach

Corporate sustainability is part of an international debate that has been echoed in Chile. In order for national companies to successfully insert themselves in a globalised world, it is essential that they remain attentive to internal and external regulatory changes. In this sense, HRDD has positioned itself as an essential tool for a business to be sustainable and comply with economic development, protection of the environment and respect for human rights. Considering the regulatory risks identified, one may consider that the best way forward for business is to adopt a preventative approach to the matter.

• First, get informed. It is key for corporations to keep up to date on regulatory developments and legislative discussions that are taking place, both with the bills in the National Congress and with the elaboration of the third NAP on Business and Human Rights. Participating in the debate is essential for companies, as industries have different concerns, and collaborative work on this issue is key. Also, any regulatory change implies an implementation cost for the company, so early identification can be very helpful.
• Second, understand. Human rights obligations are traditionally understood as obligations for states, not for corporations. While this is true, it is important for companies to realise that human rights are not a foreign language to them: they are obligations and requirements with which they are already familiar. Complying with the environmental obligations set out in a permit or licence is also a way of complying with stakeholders' human rights. It is key to train and understand the dynamism of what is meant by respecting and promoting human rights.
• Third, optimise. Do not start from scratch. The successful implementation of HRDD will depend on the organisational characteristics of each company and the challenges that different industries face. In this sense, the risk matrices that companies have as a starting point for planning and implementing human rights obligations in the company are essential.