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The current discussion about the sustainability and transparency of supply chains is characterized by conflicting positions. Whereas there is a widespread consensus that sustainable behavior of German companies in supply chains is necessary, the discussion about appropriate policy measures to enforce sustainability is still ongoing fiercely. The so-called development community insists on legal rprovisions with a strict enforcement mechanism and severe punishment. Others argue that such provisions will rather crowd out German companies of developing countries and leave the field to companies from countries where human rights and the environment play a minor role. In other words, it is doubted whether too strict requirements produce a backlash with respect to sustainability and transparency of supply chains in developing countries. The paper presents the arguments of this discussion and concludes that voluntary agreements are superior to legal provisions.

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