Introduction

Scope of application

Compliance program

Protection of whistleblowers

Audit and sanctions

Rules arising from the Sapin II Law

EU law

French law

Rules derived from competition law

Sapin II Law/Competition

Scope ratione personae

Scope ratione materiae

Scope

Development of plan

Measures included in plan

Inclusion in management report

Vigilance plan

Injunctions

Civil liability

Sanctions

Duty of vigilance (devoir de vigilance)

CSR programs

Reporting

Communication

Reporting and communication

Judicial sanctions

Risk to reputation, strategy and stability

Corporate Social Responsability (CSR)

Middlenext Code

IFA Corpus

AFEP - MEDEF Code

Types

Principles of governance

Principles incorporating CSR values

Principles

Comply or explain

Binding force

Private codes of conduct

Compliance

Among the sanctions that may be imposed on undertakings with regard to CSR, the first are those provided for in the Commercial Code as part of the reporting obligation. Article L. 238-1 (formerly Art. L. 225-102-1) of the Commercial Code stipulates that any person who has been unable to obtain the production, communication or transmission of documents or information may request the court ruling in interim proceedings either to enjoin the person or body responsible for the production, communication or transmission of the documents or information to disclose them, subject to a fine, or to appoint an agent to carry out this task. In addition, as sustainability reporting is a separate section of the management report, any company director who fails to draw it up is liable to a fine of EUR 9,000 for failure to produce a management report . Alternatively, the undertaking may be subject to the penalties laid down in Article L. 465-3-2 of the Monetary and Financial Code for misleading information in the management report drawn up by a listed undertaking, which punishes executives with five years' imprisonment and a fine of up to EUR 100 million. This amount may be increased to ten times the amount of the benefit derived from the offense, but the fine may not be less than that benefit. It has been ruled that the shareholders of an undertaking in compulsory liquidation who accuse its directors of having encouraged them to invest in and hold securities issued by the undertaking by withholding information, providing false information and misrepresenting the accounts, may take direct action against them if they claim personal harm .

Secondly, the social responsibility of undertakings also covers the health, safety and working conditions of employees. As part of their safety obligation, managers can also be penalized. In accordance with the conditions and distinctions set out in Article 121-3 of the Criminal Code, causing the death of another person through carelessness, recklessness, inattention, negligence or failure to comply with an obligation of prudence or safety imposed by law or regulation, constitutes involuntary manslaughter (homicide involontaire) punishable by three years' imprisonment and a fine of up to EUR 45,000. In addition, directly exposing another person to an immediate risk of death or injury likely to result in permanent mutilation or infirmity, through the manifestly deliberate violation of a particular obligation of precaution or safety imposed by law or regulation, is punishable by one year's imprisonment and a EUR 15,000 fine (Art. 223-1 Criminal Code). In the event of a manifestly deliberate breach of a particular duty of care or safety imposed by law or regulation, the penalties incurred are increased to five years' imprisonment and a fine of EUR 75,000. While the court is not legally bound to find that the offender was aware of the nature of the particular risk actually caused by the breach, it must establish an immediate link between the breach of regulatory requirements and the risk to which employees were exposed . The court may not acquit a person accused of manslaughter without first ascertaining, in accordance with the principle of adversarial proceedings, whether the failure to carry out an assessment of the occupational risks associated with the planned operation, which had been identified and explained by the employee concerned, even though he had not been specifically prosecuted for this offense, was not the result of a failure to inform the employee of the risks involved in moving away from his work area, and whether this failure on the part of the employer constituted a fault falling within the scope of Article 221-6 of the Criminal Code . On the other hand, a group safety officer, who is responsible for assessing potential threats in the various areas of activity of the group's undertakings on the basis of the information gathered, and for proposing recommendations to ensure the protection of property and individuals, cannot be charged with endangering the lives of others, insofar as he or she has not received written or oral delegation of powers for the purpose of ensuring compliance with the obligations set out in Articles L. 4121-3 and R. 4121-1 et seq. of the Labor Code, and that this function does not include protecting the health and safety of employees within the meaning of the Labor Code, or improving working conditions .

In addition, the law of obligations contains a set of rules that can be applied to undertakings that are committed to CSR, providing a basis for sanctions in the event of non-compliance. An undertaking's CSR committments are voluntary, unilateral acts that are not, in principle, binding . Nevertheless, it does seem possible to engage the company's responsibility. Under Article 1100 of the Civil Code, obligations may arise from the voluntary performance or promise of performance of a duty of conscience towards others. Some commentators consider that, by adhering to a CSR scheme, “undertakings transform a natural obligation (e.g. not to pollute, to produce in an environmentally-friendly manner, to adopt ecologically responsible behavior that goes beyond mere regulatory requirements) into a civil obligation to which they are subject" . However, commitments must be sufficiently precise. In fact, a moral clause by which one commitment is made “not to copy” the products marketed by another is binding on the former if it expresses the unequivocal and deliberate will to bind itself to the latter. In addition, a company that acts in breach of precisely defined, voluntary social or environmental pledges may be held liable by socially responsible institutional investors on the basis of civil liability law. It has been ruled that an urban community, in the same way as associations authorized to defend the environment, is entitled to claim compensation for harm, however indirect, caused to the ecology of its territory by an oil slick . An undertaking's commitment to CSR can also be classified as a quasi-contract, since Article 1300 of the Civil Code states that quasi-contracts are purely voluntary acts which give rise to a commitment on the part of the person who benefits from them without being entitled to do so, and sometimes to a commitment towards others. When an undertaking's corporate social responsibility declarations fall within the scope of a contract, they may also give rise to an action for liability in contract.

Lastly, in economic law, the sanction of unfairness is justified both by the founding principle of contract law, which requires that agreements be performed in good faith, and by the theory of unfair competition, which has its origins in precedent, and aims to ensure a fair balance between fairness and freedom of trade. Operators could bring an action for unfair competition on the basis of Article 1240 of the Civil Code, on the grounds that the unfair acts of the company cause them harm. For example, failure to comply with environmental regulations may constitute an act of unfair competition if it distorts competition in the relevant market . It is possible to report a competitor's actions in breach of regulations to the authorities, provided that the report is based on solid evidence . Similarly, an environmental protection association can denounce on its website the environmental policy of an oil company and its subsidiary, in accordance with its corporate purpose, as long as it does not exceed the limits of freedom of expression . There is however, in effect, a limit to the extent to which denouncing an undertaking's actions can lead to disparagement: the dissemination of malicious information about a competitor's products or person is wrongful, even if the information is accurate or common knowledge, since the exception of truthfulness does not apply to disparagement . In addition, undertakings which fail to respect their CSR commitments may be penalized under consumer law for unfair commercial practices, which are defined as any action, omission, conduct, approach or commercial communication on the part of a professional, directly related to the promotion, sale or supply of a product to consumers, which has the dual characteristic of being contrary to the requirements of professional diligence and of altering or being likely to materially distort the economic behavior of the average consumer. Any legal entity guilty of a misleading commercial practice is liable, in addition to a fine, to the additional penalties provided for in 2° to 9° of Article 131-39 of the Criminal Code (Art. L. 132-3 Consumer Code). The director of the legal entity on whose behalf the misleading commercial practice is carried out may also be held criminally liable under article L. 132-3 of the Consumer Code for his or her personal involvement in implementing the offense .

C.com., Art. . 242-8, for SAs (limited companies), Art. . 241-4, for SARLs (limited liability companies) and Art. . 243-1, for SCAs (“limited liability partnerships").

Cass. com., 9 March 2010, LawLex202200001923JBJ.

Cass. com., 8 April 2008, LawLex201200002066JBJ.

CA Paris, 27 January 2016, LawLex201600000241JBJ.

Cass. crim., 6 octobre 2009, LawLex202400003206JBJ.

Cass. crim., 16 February 1999, LawLex200300003109JBJ.

Cass. crim., 15 March 2016, LawLex202400003264JBJ.

Cass. crim., 7 September 2021, LawLex202200001404JBJ; CA Versailles, 22 March 2013, LawLex202400004221JBJ, holding that the application of the Global Compact is based solely on the will of the undertakings, so that it only constitutes an indication of reference, the non-compliance with which cannot be relied upon to justify a breach of international rights.

Cass. com., 23 January 2007, LawLex202300000869JBJ.

Cass. crim., 25 September 2012, LawLex201400000335JBJ.

Cass. com., 21 January 2014, LawLex201400000153JBJ.

Cass. com., 29 January2002, LawLex200300000947JBJ.

138. Diversity of legal bases