From Compliance to Capability: Human Resource Management's Role in Operationalising Scope 3 Supply Chain due Diligence Standards

Abstract

Mandatory human rights and environmental due diligence regimes, most notably the European Union's Corporate Sustainability Due Diligence Directive (Directive (EU) 2024/1760), have repositioned supply chain accountability from a voluntary corporate social responsibility gesture into an enforceable legal obligation that extends deep into upstream value chains, including labour-intensive production hubs across Sub-Saharan Africa. Because Scope 3 emissions and their associated social risks are generated principally through people-intensive processes such as recruitment, subcontracting, workplace conditions, training and supplier labour management, the organisational function best positioned to translate due diligence policy into everyday practice is human resource management (HRM). However, the burgeoning literature on green and sustainable HRM has concentrated overwhelmingly on employee environmental behaviour and employer branding, leaving the specific mechanisms through which HR departments can operationalise supply chain due diligence obligations comparatively unexamined, particularly in developing-economy contexts such as Nigeria, where Scope 3 exposure is acute but institutional and workforce capacity remains constrained. This paper fills that gap by using an integrative review of regulatory, theoretical, and empirical literature, where Dynamic Capabilities Theory and the Ability-Motivation-Opportunity model work together to create a conceptual framework, which transforms the role of HRM from a passive compliance administrator to an active role in building capabilities within a framework of due diligence. The paper maps five HR sub-functions, namely recruitment and supplier workforce vetting, training and capability development, performance and incentive systems, employee relations and grievance mechanisms, and HR analytics, onto the due diligence cycle of identification, prevention, mitigation, monitoring and remediation. Drawing on evidence from Nigerian regulation, labour markets, and small and medium enterprises, the paper argues that without deliberate investment in HR capability, Nigerian firms risk exclusion from European and global value chains. The paper concludes with implications for HR practice, professional bodies, policymakers and future researchers.