Ecocide and the supply chain: Why your liability does not stop at your factory gate
The most significant ecocide exposures for most companies are not in their own operations. They are in the upstream supply chains they depend on and the downstream uses of what they produce. Boards need to look further than they have been looking.
The broken assumption
One of the most consequential aspects of the emerging ecocide legal framework – and one of the least discussed in boardrooms – is the question of supply chain liability. The intuitive assumption is that a company's environmental liability is bounded by its direct operations. What happens in its own facilities, under its own operational control, is its responsibility. What happens in the operations of its suppliers, contractors and raw material producers is their responsibility. That assumption is being systematically dismantled by the legal frameworks now in force and in development across major trading jurisdictions.
The dismantling is happening simultaneously on several fronts: criminal law, civil liability and mandatory due diligence regulation. Each of these fronts is moving independently and in the same direction. The cumulative effect is that a company's legal exposure for environmental destruction now extends, in principle, as far as its supply chain extends – which for most multinationals means into every continent and dozens of jurisdictions, including those with the most biodiverse and most threatened ecosystems on earth.
The EU Deforestation Regulation
The EU Deforestation Regulation, which entered into force in 2023, makes supply chain environmental liability concrete and immediate. It requires companies placing cattle, soy, palm oil, timber, cocoa, coffee, rubber and their derivative products on the EU market to prove that those products have not contributed to deforestation or forest degradation. The due diligence obligation is the company's, not the supplier's. Non-compliance carries fines of up to 4% of EU annual turnover. The regulation explicitly requires traceability to the plot of land where the commodity was produced – not to the supplier, but to the geographic origin.[1]
This is a remarkable standard. It requires companies to know not just who they buy from, but where that supplier's output originated – and to have documentary evidence that the land in question was not subject to deforestation after December 2020. For companies with complex, multi-tier supply chains spanning dozens of countries and hundreds of suppliers, this is a fundamentally different level of due diligence from anything previously required. Supplier declarations and contractual warranty clauses are not adequate. The regulation requires verified evidence.
The TNFD and broader nature accountability
The Taskforce on Nature-related Financial Disclosures (TNFD) framework asks companies to assess their nature-related dependencies and impacts across their full value chain – not just Scope 1 direct operations, but the upstream extraction, land use and ecosystem impacts embedded in their supply chains and the downstream consequences of what they produce. The TNFD framework has been adopted by over 400 leading organisations globally and is being integrated into mandatory reporting expectations by regulators in the UK, EU, Japan and Singapore.[2]
Under TNFD, a food and beverage company that sources ingredients from suppliers whose production causes significant biodiversity loss is expected to identify, assess and disclose that exposure – even if the company has no direct operational presence in the affected ecosystem. This is the logic of value chain accountability applied to nature, mirroring the Scope 3 emissions framework that has already been established for greenhouse gases. The parallel is not accidental: the architects of TNFD deliberately modelled it on the TCFD climate framework precisely because the accountability mechanisms that proved effective for carbon are now being applied to nature.
Criminal liability in the supply chain
Beyond the disclosure frameworks, the criminal liability dimension is where supply chain risk becomes most acute. The ecocide frameworks being enacted across Europe do not limit criminal liability to the company that directly caused the destruction. The EU Environmental Crime Directive's framework on corporate liability requires examination of whether an offence was committed 'for the benefit of a legal person' – a formulation that can extend to companies that commissioned, purchased from, or otherwise financially benefited from environmentally destructive activity, even if they did not conduct it directly.
The Grantham Research Institute at the London School of Economics has noted that climate and environmental plaintiffs are now extending their targets beyond energy companies into 'animal farming and transport, as well as the food and retail sectors.' This broadening is consistent with the logic of supply chain liability – once the legal tools exist to hold downstream companies accountable for upstream destruction, the range of targets expands rapidly.[3]
Practical implications for boards
For boards, the practical implication is that supply chain due diligence is now an environmental governance issue at the same level of seriousness as direct operational performance. Knowing what your major suppliers are doing to the ecosystems in which they operate is no longer optional information. It is a compliance requirement in some jurisdictions, an emerging legal liability in others and a reputational and financial risk in all of them. The companies that have invested in supply chain traceability, supplier environmental auditing and verified procurement standards are building positions of genuine advantage. Those still relying on supplier self-declarations and contractual warranties are carrying exposure they have not yet measured.
The ecocide exposure most likely to produce headlines over the next decade will not come from a company's own facilities. It will come from a catastrophic environmental event traced back through a supply chain to a commodity used in a branded product, sold by a company whose board had access to information about the risk and chose not to look at it too closely. The boards that understand this now and act on it are the ones that will not be in that story.
References
[1] Ecocide Law, 'Existing and Proposed Ecocide Laws – EU Deforestation Regulation'. https://ecocidelaw.com/existing-ecocide-laws/
[2] UCLA Law Promise Institute Europe / Ecocide Law Advisory, 'Working Group on National Criminalization of Ecocide' (2025). https://www.promiseeurope.law.ucla.edu/ecocide-law-advisory
[3] Context by Thomson Reuters Foundation, 'Climate Change in Court: Cases to Watch in 2026' (11 December 2025). https://www.context.news/climate-justice/climate-change-in-court-cases-to-watch-in-2026