Legal systems in comparison
The Italian and French responses to the EU innovations in sustainable finance

G. Mollo, L. Picardi, J.B. Poulle, E. Rodriguez
With a preface by J. Mähönen

Quaderno finanza sostenibile (paper) no. 4 - June 2024 [PDF] (Italian version)
 

Abstract
The Paper considers the impact that European legislation, together with Articles 9 and 41 of the Constitution, has in Italy on the management duties of the administrative body of joint-stock companies, as well as on the very configuration of the corporate purpose. It then analyses the concept of “sustainable success” introduced by the Corporate Governance Code and the orientation of management towards a medium- to long-term horizon, before going on to examine Consob’s growing involvement in promoting environmental and social sustainability issues.
The second part of the Paper examines the regulations of sustainable finance introduced by French law. It outlines a rich and complex regulatory framework, which reflects the attention paid by the national legislators, institutional investors and asset managers to the goals of environmental protection, human rights safeguarding and good corporate governance, summarised in the acronym ESG. The role of self-regulation, the Capital Market Authority (AMF) and civil society itself in the environmental and social transition and in combating possible greenwashing abuses is then examined.
The starting point for the analysis is a systematic review of the evolving European regulatory framework, that, after being characterised over the last decade by the introduction of a series of measures aimed at promoting and ecological and social transition of the economy, has launched an ‘Omnibus Package’ of amendments (i.e. deferrals and simplifications) of EU regulations on business and sustainability. The new regulatory framework raises the question of whether the choices made by the European Union institutions represent – as seems plausible – a cautious gradualism inspired by the desire to contain the costs and risks associated with the sustainable transition and to make the corrections called for by the political situations, or whether they prelude a revision of these choices.
At present, the Directive on reporting (CSRD) and sustainability due diligence (CS3D) and the Taxonomy Regulation impose specific transparency and conduct obligations on companies in sustainability which are likely to influence the conduct of directors of joint-stock companies, especially those of systemic importance such as listed companies. There is a growing appreciation of the role of companies in promoting collective interests, which, however, does not entail companies taking on tasks traditionally performed by States. It also follows that, in the medium term, companies that can comply with sustainable management obligations are able to attract consumers and investors, at least due to the presence of reputational incentives, and generate profits for shareholders.  
 

Authors
The working group, coordinated by Giovanni Mollo (CONSOB Research and Regulatory Department, g.mollo@consob.it), includes Lucia Picardi (University of Naples “Federico II”), Jean-Benoît Poulle and E. Rodriguez (lawyers belonging to the French Bar). The authors would like to thank Guglielmina Onofri, Paola Deriu, Gianfranco Trovatore, Federico Picco, Maria Raffaella Sancilio e Andrea Giannini for their useful comments and suggestions. The opinions expressed in this document are the authors’ personal views and are in no way binding on CONSOB. In citing this paper, it is therefore not correct to attribute the arguments expressed therein to CONSOB.