Corporate governance and due diligence

Corporate Governance

Our work on corporate governance focusses on decision-making in boards (including composition/diversity and remuneration), shareholders rights (voting and identification), transparency towards company relevant stakeholders and authorities, and regulated market requirements (including listing and insider dealing).

Current corporate governance models in the Member States are well-functioning and have been developed and fine-tuned over many years, along with being adapted to their respective legal and cultural environments. These Member State models must remain flexible enough to give room for and incentivise continued financial and organisational innovation. The widely accepted “comply or explain approach” which applies across the EU in this area must not be diluted. Finally, continued respect for different structures of Member States is key for the competitiveness of European businesses.

Due diligence

We strongly support a harmonised, clear, and workable EU legal framework on due diligence. Such a framework should enable businesses to behave responsibly across their global value chains, while still being realistic about the role and leverage of companies within those chains.

The Corporate Sustainability Due Diligence Directive (CS3D), now in force since July 2022, is the first horizontal binding legal instrument in the EU on due diligence. BusinessEurope has worked constructively during the legislative process of this Directive, putting forward the priorities of its membership and providing expertise around value chain due diligence challenges and opportunities to decision makers. While we have been actively monitoring the transposition and implementation of this Directive, we are equally urging a re-examination of some of the complex and disproportionate rules during the EU’s first simplification Omnibus now underway.