Environmental Accountability Responsibilities of Enterprises under FTA Standards:

A Comparative Legal Perspective Between Vietnam and the European Union

Nguyễn Hữu Khánh Linh

 

ABSTRACT: In the free trade agreement between Vietnam and the European Union (EVFTA), environmental accountability is established as a legal obligation aimed at ensuring that business operations do not inflict environmental harm. This article argues that under the EVFTA, environmental accountability operates as a form of trade conditionality, whereby access to the EU market increasingly depends on enterprises’ compliance with EU-defined sustainability and due diligence standards rather than tariff liberalisation alone. Enterprises are required to assess, monitor, and disclose environmental impacts throughout their supply chains. The European Union has codified this obligation through the Corporate Sustainability Reporting Directive, which mandates enterprises to publish Environmental, Social and Governance (ESG) reports in accordance with the European Sustainability Reporting Standards (ESRS) and to undergo independent auditing. These obligations substantiate the EU’s commitment to sustainable development under the EVFTA. In contrast, Vietnam currently lacks mandatory regulations concerning ESG disclosures. This legal and institutional gap creates barriers for Vietnamese businesses seeking access to the European market. The article proposes: (i) enacting a national legal framework for environmental accountability; (ii) referencing international standards such as Global Reporting Initiative Standards and ESRS; (iii) integrating ESG obligations into domestic law; and (iv) strengthening enforcement and supervision through collaboration between state agencies, civil society, and international partners. Legal reform in this area is necessary not only for EVFTA compliance but also to enhance Vietnam’s long-term competitive capacity in the global economy.