Saturday

16th Dec 2017

EU seeks more corporate transparency

  • Companies would have to publish their boardroom policies (Photo: ShellVacationsHospitality)

EU companies will be required to publish information ranging from anti-corruption and bribery measures to their boardroom policies and employment practices, under new legislation unveiled by the European Commission on Tuesday (16 April).

The Commission draft, which would cover an estimated 18,000 European companies with more than 500 employees, would also force firms to assess the environmental and social results of their activities,

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

In a statement launching the legislation, internal market commissioner Michel Barnier said that more corporate accountability would lead to more profits.

"Companies that already publish information on their financial and non-financial performances take a longer term perspective in their decision-making. They have lower financing costs, attract and retain talented employees, and ultimately are more successful," he noted.

Speaking later with reporters in Strasbourg, Barnier said the new requirements were aimed at increasing "cohesion for businesses and between businesses."

He added that greater company transparency was "needed for all sectors, not just banks."

The proposal is the latest attempt to increase transparency standards for EU companies.

Earlier this month, MEPs and ministers reached agreement on country-by-country reporting by companies in the extractive and logging sector. Meanwhile, from 2014 banks will also be required to disclose information ranging from profits and turnover to employee numbers and tax payments.

Jana Mittermaier, director of the campaign group Transparency International said that the new rules would "help to raise awareness about corruption risks in the private sector and steps that companies can take to address them."

For her part, Rachel Jackson of the accountancy trade-body ACCA expressed hope that "the latest EU proposals will significantly improve the level of transparency and comparability."

However, Jerome Chaplier of the European Coalition for Corporate Justice commented that "we fear companies will only identify and disclose the risks that affect their economic performance, and won’t take responsibility for the impacts they have on the people and the planet."

The new reporting requirements would cost between €1,200 and €4,900 per company each year, according to the commission's impact assessment.

The commission says that around 2,500 out of an estimated 42,000 EU companies voluntarily provide non-financial information on their activities. Barnier singled out companies in the Netherlands, France and Denmark for the best behaviour, describing them as "way ahead of the others."

Meanwhile, the EU executive's demand for companies to report on their diversity policies follows draft legislation tabled in November 2012 aimed at increasing the number of women executives to 40 percent.

The proposal will now be scrutinised by MEPs on the legal affairs committee, with parliament sources suggesting that the centre-right EPP group would probably take control of the dossier.

Analysis

EU mulls post-Brexit balance of euro and non-eurozone states

Brexit will dramatically change the balance between EU members states that have the euro and those that don't. The thinking on the future of the eurozone is done at EU-27 level - but opposing camps will have to be reconciled.

Facebook to shift ad revenue away from Ireland

Public pressure about low corporate taxes appear to have pressured Facebook to launch plans to stop routing international ad sales through its Dublin-based headquarters in Ireland.

News in Brief

  1. EU adopts 'track-and-trace' tobacco system
  2. Luxembourg appeals Amazon tax decision
  3. EU leaders agree to open phase 2 of Brexit talks
  4. Juncker: May made 'big efforts' on Brexit
  5. Merkel took 'tough' line on Russia at EU summit
  6. EU leaders added line supporting 'two-state' solution
  7. EU leaders agree to 20 European Universities by 2024
  8. Belgian courts end legal proceedings against Puigdemont

Stakeholders' Highlights

  1. Dialogue PlatformThe Gülen Community: Who to Believe - Politicians or Actions?" by Thomas Michel
  2. Plastics Recyclers Europe65% plastics recycling rate attainable by 2025 new study shows
  3. European Heart NetworkCommissioner Andriukaitis' Address to EHN on the Occasion of Its 25th Anniversary
  4. ACCACFOs Risk Losing Relevance If They Do Not Embrace Technology
  5. UNICEFMake the Digital World Safer for Children & Increase Access for the Most Disadvantaged
  6. European Jewish CongressWelcomes Recognition of Jerusalem as the Capital of Israel and Calls on EU States to Follow Suit
  7. Mission of China to the EUChina and EU Boost Innovation Cooperation Under Horizon 2020
  8. European Gaming & Betting AssociationJuncker’s "Political" Commission Leaves Gambling Reforms to the Court
  9. AJC Transatlantic InstituteAJC Applauds U.S. Recognition of Jerusalem as Israel’s Capital City
  10. EU2017EEEU Telecom Ministers Reached an Agreement on the 5G Roadmap
  11. European Friends of ArmeniaEU-Armenia Relations in the CEPA Era: What's Next?
  12. Mission of China to the EU16+1 Cooperation Injects New Vigour Into China-EU Ties

Latest News

  1. Catalonia, Brexit, and Uber on EU agenda This WEEK
  2. Macron and Merkel take tough line on Poland
  3. Eurozone future needs structural reforms, EU leaders told
  4. Showdown EU vote on asylum looking likely for next June
  5. EU stresses unity as it launches next phase of Brexit talks
  6. Polish PM ready for EU sanctions scrap
  7. Dutchman to lead powerful euro working group
  8. EU mulls post-Brexit balance of euro and non-eurozone states