ABSTRACT Growing awareness of social and environmental risks in global supply chains has driven a shift from voluntary corporate responsibility toward mandatory due diligence legislation. These emerging regulatory frameworks require businesses to identify, prevent, and mitigate adverse human rights and environmental impacts, thereby redefining the boundaries of corporate accountability. Within this evolving context, voluntary sustainability standards (VSS), which have hitherto functioned as central actors in transnational governance through standard‐setting, certification, and capacity building, must reconsider their roles and strategic orientations. This paper examines the implications of due diligence legislation for VSS through a qualitative case study of the Global Organic Textile Standard (GOTS), a leading certification scheme in the textile sector, leading to two key findings. First, rather than weakening VSS, public regulation can strengthen voluntary standards by establishing a legal floor that empowers private regulators to raise sustainability requirements more ambitiously than market constraints allow. Second, international organizations, through the Organisation for Economic Co‐operation and Development (OECD), play a critical role in orchestrating public–private alignment through benchmarking and guidance, mitigating risks of fragmentation in complex governance regimes. The paper thereby contributes to debates on hybrid and “smart mix” regulatory approaches.
Marx et al. (Mon,) studied this question.