ISEAL supports voluntary sustainability systems to strengthen their approach to human rights in a changing regulatory environment – from operationalising free, prior and informed consent (FPIC) principles to advancing remediation efforts.

New mandatory due diligence regulations are emerging globally, intersecting with existing sustainability frameworks and human rights protections and presenting complex challenges for sustainability systems and the businesses they work with. Among these, a particularly important area of focus is the human rights dimension of the EU Deforestation Regulation (EUDR). Under the EUDR’s so-called legality requirement, companies must demonstrate that products in scope bear no more than negligible risks of having been produced illegally.

A broad range of laws must be accounted for when assessing risks of illegal production. Human rights-related laws are one central component, signalling that efforts to prevent deforestation are inseparable from respect for the rights of workers, communities and Indigenous peoples affected by or involved in commodity production. 

To comply with the legality requirement, companies will need to identify all applicable laws and collect “adequately conclusive and verifiable” documentation to show that commodities were produced in accordance with the relevant legislation of the country of production. They will need to continue to demonstrate a negligible risk of non-compliance. Where risks of non-legal compliance are identified, companies must take action to resolve the issue. 

But assessing compliance with legal areas that govern human rights is challenging. Consider for example the difficulty of assessing whether seasonal and informal workers on remote cocoa farms are afforded the rights they are entitled to under national law, or whether FPIC has been meaningfully respected in a Brazilian soy operation. 

These challenges are compounded by complex legal landscapes that companies must navigate. A producing country may have conflicting, unclear or overlapping legislation, creating ambiguity over legal rights and producers’ obligations. In such contexts, or in cases of weak legal enforcement, determining what constitutes 'legal' production is a complex exercise requiring deep local knowledge and ongoing legal interpretation.

Another challenging area is customary land-use rights, where communities may have traditional ownership or use rights that lack formal documentation. In areas where land-use rights are provided through customary rights but where documentation is required by law, companies face significant verification challenges to demonstrate legal land use. 

Verifying legal production in certified supply chains

Voluntary sustainability systems have decades of experience in assessing and monitoring compliance with national and local laws at certified production sites. Many sustainability systems require legality of production within their standards and verification processes. For example, the Round Table on Responsible Soy (RTRS) Standard for Responsible Soy Production requires as its first principle “awareness of, and compliance with, all applicable local and national legislation”. Similarly, the RSPO Principles and Criteria 2024 require certified growers to operate legally, complying with applicable and relevant laws and ratified international laws and regulations.

Many sustainability systems are adapting their standards to align with the EUDR legality requirement. Their assessment frameworks typically include comprehensive lists of regulations that auditors verify compliance against, whether specifically addressing the areas covered by the EUDR or encompassing all relevant legislation more broadly. 

With this systematic approach to legal verification, voluntary sustainability standards are well-positioned to support EUDR compliance. Embedding legality requirements in their standards can help ensure production follows local laws, and audits and assessments should verify this. Through detailed guidance, training and oversight, sustainability systems can help certification bodies and auditors assess legal compliance in a consistent and credible manner.

ISEAL-commissioned research has also identified a number of multistakeholder initiatives, NGOs and legal advocacy groups that are developing resources to help identify relevant laws in production countries. The Land Portal, for example, is a global information portal for land-related legal information and community of land experts from civil society, government and academia. 

Supporting meaningful legal compliance: the case of FPIC

FPIC presents a particularly challenging area. Monitoring adherence with FPIC principles requires more than a simple documentation check, since meaningful compliance entails ongoing engagement with Indigenous communities.

FPIC is a continuous process, not a one-time checkbox exercise. Indigenous peoples have the right to withhold consent to any projects that affect them and their territories, and can withdraw their consent at any time if proposed activities change or new information emerges. Companies cannot simply obtain initial approval and consider their FPIC obligations fulfilled, but must maintain ongoing dialogue and be prepared to adapt operations if consent is withdrawn.

A common failure in FPIC implementation occurs when consultation processes are insufficient or culturally inappropriate. For example, conducting brief consultations in languages that community members don't fully understand, or engaging only with self-appointed representatives rather than traditional governance structures, can undermine the validity of any consent obtained. This in turn creates legal vulnerabilities for companies under national and international law.

ISEAL has been exploring how sustainability systems can integrate FPIC requirements, through desktop research and an in-person workshop held in São Paulo. Both the research and the workshop raised challenges, but also revealed examples of how sustainability systems can contribute to meaningful FPIC adherence. We will be summarising these findings in a learning report later this year.

As an example, the Forest Stewardship Council (FSC) has long recognised FPIC as a fundamental safeguard for responsible forest management, particularly in contexts where Indigenous peoples and local communities hold rights to land and resources. In FSC’s system, FPIC is a prerequisite before any forestry operation begins and remains an ongoing process throughout the life of a forest management certificate. This approach ensures that communities are fully informed about proposed activities, have adequate time to deliberate, and can make decisions free from pressure or manipulation, while maintaining dialogue throughout the project to allow for consent to be withdrawn if the community believes their wishes are not being upheld.

FSC has incorporated FPIC directly into its principles and criteria – specifically Principle 3: Indigenous Peoples’ Rights, which mandates that organisations must identify and uphold Indigenous peoples’ legal and customary rights to land, territories and resources – making them a mandatory part of certification audits. Assessors must verify that certificate holders engage in culturally appropriate consultations, respect customary decision-making processes, and maintain consent over time – especially if management plans or land use change. 

Looking ahead: next steps for companies and sustainability systems

Although certification is not a ‘green lane’ for EUDR compliance, voluntary sustainability systems are uniquely placed to support companies to meet their human rights due diligence and legality requirements. While certification alone is not evidence of compliance, sustainability systems offer a source of credible assurance and documentation. 

Sustainability systems can support companies to identify relevant human rights laws, implement complex FPIC processes, and build stronger, long-term engagement with rights-holders. By collaborating with sustainability systems and their partners, companies can go beyond checklist documentation towards inclusive human rights-based compliance.

ISEAL's work on deforestation-free supply chains is generously supported by the Walmart Foundation.