EuropeanIssuers favours a recommendation and denies the need of an EU legislation for a Sustainable Corporate Governance Framework
In its position paper issued jointly with the answer to the European Commission’s Consultation on sustainable corporate governance,
EuropeanIssuers reiterated openly its concern on the study which served
as the basis for the consultation. Whilst fully supporting the concept
of sustainable corporate governance which helps reconcile economic
growth, social progress and environmental protection, it said that the
questionnaire led to predefined answers impeding participants to express
dissenting opinions without being regarded as opponents of good
governance.
Luc Vansteenkiste, Chairman of EuropeanIssuers said: “We regret
the lack of consideration of the social reality of the business
environment. Companies already integrate sustainable governance in their
strategy in many ways through increased dialogue with stakeholders and
discussing CSR risks and criteria in executive compensation at the board
level. A company’s long-term vision embraces and considers its
environment, customers and people otherwise it has no future. This
evolution is at the core of the new set of principles of the Corporate
Governance codes across the EU and applied by business leaders”.
Florence Bindelle, Secretary General of EuropeanIssuers added: “If
the EU considers it necessary to take further action on the issue of
corporate governance, this subject should be better dealt in the form of
a Recommendation towards the Member States in order to avoid a “one
size fits all” approach due to the wide diversity of corporations and
practices.”
EuropeanIssuers highlighted that several aspects of directors’ duties
were sufficiently covered by existing legal requirements of other EU
legislative instruments and corporate governance codes. For example,
when it comes to the management of the risks and opportunities in
relation to stakeholders, not only is the current framework sufficient
and efficient, but it will be further strengthened following the review
of the non-financial reporting directive. As such, EuropeanIssuers
recommended that overlapping of legislation should be avoided on the
obligations of directors.
Furthermore, EuropeanIssuers considered that there is no need for a
definition at EU level of the company interest, as the diversity of
companies and sectors in which they operate is ill-suited to
prescriptive and uniform rules that may hinder the development of good
practices.
Moreover, in its response, EuropeanIssuers restated that while
supporting an EU legal framework for supply chain due diligence, it
needs to be constructed as an obligation of means, including only the
most severe risks, and align with internationally recognised principles
of responsible business conduct. An EU legislative framework on the
human rights shall require companies to make best efforts to avoid
violations of human rights. It mentioned that measures shall apply also
to non-EU companies operating within the EU.
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For EuropeanIssuers’ response to the European Commission’s Consultation on sustainable corporate governance, please click here.
For EuropeanIssuers’ position on sustainable corporate governance, please click here.
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