Sustainability clauses in commercial contracts: what works

A sustainability clause is only worth something if you can enforce it. In practice, many provisions stop at an obligation to use best efforts, without a benchmark, without a right to information and without a sanction. Nothing then changes in the supply chain. This article shows how to draft them sharply, and where the Omnibus I package has drawn a statutory limit.

The short answer

Turn the sustainability requirement into a defined characteristic of the performance, not a statement of intent.
Tie the requirement to an objective benchmark: a standard, a certificate or a measurable figure.
Provide expressly for information and audit rights. Without information you can establish nothing.
Provide for the consequences: cure, penalty, suspension, termination and damages.
Bear the value chain protection in mind. Where your counterparty has no more than 1,000 employees, a request going beyond the VSME standard is not enforceable.

Which types of provision exist

Explicit sustainability clauses

Sustainability provisions fall broadly into five groups.

Product characteristics. What is delivered must have a particular composition, origin, service life or recycled content. This is the strongest type of provision, because it connects directly to the conformity requirement in Article 7:17 of the Dutch Civil Code (Burgerlijk Wetboek, BW).
Production methods and standards of conduct. The supplier complies with a code of conduct, with ILO standards or with a sector standard. Here the defect does not lie in the product itself, which makes proof harder.
Information and reporting obligations. The supplier provides data for your own reporting, for a product passport or for customs obligations.
Inspection and audit rights. You may verify, yourself or through a third party, on site or on the documents.
Flow-down obligations. The supplier imposes the same obligations on its own suppliers.

How to make a clause enforceable

The core problem is vagueness. “The parties strive for a sustainable collaboration” is not an obligation a court can review. Work through four steps instead.

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CISG

Step 1: make the standard objective. Refer to an existing standard, a certificate or a measurable quantity. A percentage of recycled material, a certificate number or a standard with a version number can be tested. “Environmentally friendly” cannot.

Step 2: define the character of the obligation. Record whether it is an obligation of result or an obligation to use best efforts. For an obligation of best efforts, describe the minimum efforts expected and the moments at which they are due.

Step 3: link it to the performance. State expressly that the sustainability characteristics form part of what has been agreed. A departure then amounts to non-conformity, and you have the ordinary set of remedies under Books 6 and 7 BW at your disposal.

Step 4: deal with proof. Determine who must establish what, with which documents and within which period. An agreement on evidence prevents you from becoming stuck in proceedings on the question of who bears the burden of proof.

Civil Code

In international sales, the Vienna Sales Convention (CISG) may apply. Termination there requires a fundamental breach (Articles 25 and 49 CISG). Under Dutch law the threshold is lower: Article 6:265 BW permits termination (ontbinding) unless the breach does not justify it. So decide deliberately which law you choose, and consider excluding the CISG if you want room to terminate where sustainability requirements are breached.

Information and audit rights

Without information you can establish nothing and therefore enforce nothing. Set out the following in concrete terms:

Subject	What you record
Which data	An exhaustive list, with format and method of measurement.
Frequency	Per delivery, per quarter or annually, with fixed deadlines.
Accuracy	A warranty that the data are accurate and complete, with a duty to notify any change.
Audit	Who may verify, how often, on what notice and who bears the costs.
Costs on deviation	Provide that the supplier bears the audit costs if a material deviation comes to light.
Confidentiality	Protection of trade secrets, with an exception for statutory reporting.

Implicit customs

Consider the practical side too. An audit right you never exercise is of little use in a dispute. Build a sample check into your own processes.

Consequences of non-compliance

The standard remedies work, but not always well. Performance is often difficult where sustainability requirements are breached, because the physical quality of the goods is usually unaffected. Loss is hard to quantify. It therefore pays to make additional arrangements.

Cure period. Give the supplier a fixed period to remedy a deviation that has been identified, together with a remediation plan.
Contractual penalty. A penalty clause removes loss as a problem of proof. Bear Article 6:94 BW in mind: the court may reduce the penalty where fairness manifestly so requires. Keep the amount proportionate and support it with reasons.
Suspension. Provide that you may suspend payment or acceptance for as long as the deviation continues.
Termination. Designate qualified breaches, such as forced labour or falsified certificates, as breaches justifying termination without notice of default.
Reputational harm. State expressly that loss through damage to reputation and the costs of investigation and remediation are recoverable. Without such a provision, argument follows.
Indemnity. Have the supplier indemnify you against fines imposed by regulators and against third-party claims flowing from its breach.

CISG

Watch the connection with your own communications. If you make public statements that rest on supplier data, you carry the risk for those statements yourself under consumer law. See our page on greenwashing and environmental claims.

The limit: value chain protection since Omnibus I

The Omnibus I package entered into force in March 2026 and introduced a hard limit. Companies with no more than 1,000 employees on average are protected against excessive information requests from the value chain. They need supply no more than the voluntary SME standard (VSME) prescribes. A contractual provision that goes further is not enforceable.

That has two consequences for your contracting practice.

Civil Code

If you are the purchaser, there is little point in imposing standard terms that exceed this limit. You cannot invoke such a provision and you create needless resistance. Review your purchasing terms and reduce them to the VSME set. Supplement that with data you may request on another basis, such as product information for conformity or customs purposes.

If you are the supplier, you may refuse an excessive request with reasons. Do so in writing and offer what the VSME standard does require. That keeps the relationship intact without accepting an unenforceable obligation.

The protection covers information requests arising from sustainability reporting. It does not release you from product law obligations or from what you have agreed as a characteristic of the performance. See further our pages on the CSRD and ESG reporting.

Conclusion

Frequently asked questions

Is a code of conduct in an annex binding? Only if the contract expressly refers to it and designates the code as part of the agreement. State the version and the date, and provide for what happens if the code is amended.

Can I terminate if my supplier breaches a sustainability standard? You can, provided the breach justifies termination (Article 6:265 BW). To be safe, record which breaches the parties regard as sufficiently serious.

May I still ask my SME supplier for additional data? Asking is permitted. Enforcing is not, in so far as the request goes beyond the VSME standard and your counterparty falls within the protection. Voluntary cooperation remains possible.

Contact

Would you like your purchasing terms or supply contracts reviewed on their sustainability provisions? Contact Law & More in Eindhoven or Amsterdam. We draft clauses you can actually invoke, in Dutch and in English.

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Sustainability clauses in commercial contracts: what works