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

Codes of conduct are a prelude to good corporate governance. Their role is to institute, by means of recommendations and guidelines, a framework of more moral and ethical governance within the undertaking. Depending on the objectives pursued, a multitude of internal codes have been adopted for an undertaking, a particular sector or a particular profession. We will concentrate here on private codes for undertakings, namely the Middlenext code, the AFEP-MEDEF code, the IFA corpus and the MEDEF ethics charter.

Middlenext is an independent French association founded in 1987 which represents the interests of undertakings in all business sectors, listed on the Euronext and Euronext Growth markets, in dealings with stock market authorities, public authorities and European bodies. It is the driving force behind the Middlenext Code for mid-sized and family-owned listed undertakings, which has been revised and updated several times, most recently in 2021. Inspired from the outset by CSR concerns, it encourages undertakings to adopt mechanisms for combating corruption, managing human and natural resources, and promoting diversity, while providing member companies with a governance framework that respects certain values such as professional ethics, the empowerment of women on boards of directors, and financial transparency. It also aims to organize relations between the undertaking and its shareholders.

The French Institute of Administrators (IFA) is a professional association created in 2002, which brings together corporate board member of all types of companies.The IFA regularly organizes training courses, seminars, conferences and working groups to guide board members in their role as such. As part of its activities, the IFA works closely with a number of regulatory bodies, with whom it defends the interests of its members. Through its reports, guides, notes and summaries, it aims to encourage undertakings to comply with good governance practices. Members of corporate boards play a fundamental role for the IFA, which has devoted a body of rules to them, a veritable ‘vade-mecum’, in which it details the obligations to which they must adhere in order to carry out their duties properly. The IFA believes that board members must carry out their duties in accordance with the company's interests, with professionalism, efficiency, independence, courage, a responsibility to speak out, commitment, integrity and loyalty. Above all, they must comply with the law and the company's articles of association and avoid conflicts of interest.

The origins of this code lie in a report jointly initiated by the Association française des entreprises privées (AFEP) (French Association of Private Enterprises) and the Mouvement des entreprises de France (MEDEF)  (French Business Confederation) in 2003. The report was intended as a consolidation of the work already carried out in France, and as a response to the European Commission's requirements in the field of corporate governance. In effect, the Commission asked each Member State to designate a reference code with which undertakings should comply, or to explain how and why their practices differ (the “comply or explain” principle). The report also commented on the collegial nature of the Board of Directors and the importance of “regulation” in this area, the Board's missions, its composition, the presence of independent directors, the Board's communication with the market, the functioning and evaluation of the Board, the status and role of directors, their ethics and remuneration, the need to separate the functions of Chairman of the Board and Director General, etc. The report gradually took the form of a code and, in 2008, a new version was published adopting the report's recommendations and also focusing on the pay of executive and non-executive corporate officers. This code has been revised several times, most recently in 2022, to take greater account of CSR aspects, with particular reference to climate.

On 17 May 2021, the MEDEF published an ethics charter for its members, which promotes: 
- exemplary conduct and responsible actions in economic, social, environmental, societal, ethical and governance matters, and in favor of professional equality and diversity;

a commitment to the common good of undertakings based on freedom and progress;

- openness and transparency in relations with stakeholders, based on respect, cooperation and professionalism.

Code of corporate governance drawn up by Middlenext, available at https://www.middlenext.com/IMG/pdf/c17_-_cahier_14_middlenext_code_de_gouvernance_2021-2.pdf.

IFA (Institut Français des Administrateurs) paper, ‘Corporate governance structure: decision-making criteria’, January 2013; IFA Directors' Charter; Summary note from the IFA Ethics Commission, directors and conflicts of interest.

Code of corporate governance for listed companies issued by the Association Française des Entreprises Privées (AfEP) and the Mouvement des Entreprises de France (MEDEF), available at https://hcge.fr/le-code-afep-medef/.

MEDEF is an employers' body set up in 1998 as a successor to the Conseil National du Patronat Français, itself founded in 1945, which brings together a majority of small and medium-sized businesses.

Ethics Charter of 17 May 2021, available at https://www.medef.com/uploads/media/default/0019/99/14272-charte-ethique-medef-11-2021.pdf.

141. Codes of conduct