GRI Due Diligence and Business Relationships: Cause, Contribute and Directly Linked

Working edition · 1 August 2026

GRI reporting is about the organisation's impacts across activities and business relationships. The same adverse outcome can require different management responses depending on how the organisation became involved. A supplier incident, for example, can be directly linked to a buyer's product, or the buyer can contribute through unrealistic lead times, pricing or purchasing practices.

The distinction therefore changes due-diligence action, the use of leverage, expectations for remediation and the description under GRI 3-3. It should not be used as a labelling exercise designed to distance the organisation from harm.

The materiality process identifies actual and potential negative impacts the organisation causes, contributes to or is directly linked to through business relationships.

Direct linkage is not limited to direct contractual relationships or first-tier sourcing.

The way the organisation is involved determines how it should address the impact and whether it is responsible for providing or cooperating in remedy.

For potential negative impacts, the organisation should prevent or mitigate; for actual impacts it caused or contributed to, it should remediate through legitimate processes.

For directly linked impacts, it should seek to prevent or mitigate even when it has not contributed, usually by using or increasing leverage.

Disclosure 3-3 asks the organisation to describe whether impacts arise through activities or business relationships and the actions taken to prevent, mitigate and remediate them.

Cause is not limited to intentional misconduct; an omission can also cause or contribute.

Contribution is not established merely because the organisation is commercially connected to the entity. The organisation's own conduct must be examined.

Direct linkage does not mean legal liability, ownership or control.

Direct linkage is not limited to tier-one suppliers or direct customers.

The categories are not permanent. New facts, warnings, incentives or decisions can move the analysis from direct linkage towards contribution.

The terminology applies to negative impacts. Positive impacts are assessed through contribution to sustainable development, not this three-part involvement classification.

Figure 1. Cause, contribution and direct linkage connect the organisation to a negative impact in different ways and lead to different response expectations.

1. Define the negative impact precisely: affected people or environmental receptor, location, activity, timing and actual or potential status.

2. Identify the organisation's own decisions, actions and failures to act before examining the other entity.

3. Test cause: would those actions alone result in the impact?

4. Test contribution: did they facilitate, incentivise or combine with the other entity in a meaningful way?

5. If neither is supported, test direct linkage through an operation, product or service and the relevant business relationship.

6. Document uncertainty and competing interpretations; do not force a definitive label where the facts are incomplete.

7. Match the response plan to the classification, severity, likelihood, leverage and remediation expectations.

8. Feed the evidence into the impact inventory, significance assessment, material-topic decision and GRI 3-3 disclosure.

A hypothetical retailer discovers excessive overtime at a supplier. The first internal note labels the impact 'directly linked'. Procurement records then show that the retailer repeatedly reduced lead times after the supplier warned that capacity was insufficient. The team reassesses the facts and concludes that the retailer may have contributed by incentivising the working-hours impact. The response therefore includes changing forecasting and purchasing practices, using leverage with the supplier, supporting worker remedy where appropriate, and describing the impact and actions under the relevant material topic. The classification remains subject to legal and technical review because contribution depends on the full facts.

Classifying every supplier or customer impact as directly linked without examining the organisation's own incentives and omissions.

Using lack of ownership or contractual control to exclude an impact.

Treating direct linkage as only a first-tier relationship.

Assuming a code of conduct proves prevention or mitigation.

Discussing leverage without showing how it is used or increased.

Reporting remedy only as a grievance channel rather than actual outcomes for affected stakeholders.

Changing the classification in legal, sustainability and procurement documents without a shared evidence record.

Using the classification to minimise accountability rather than to design the correct response.