Making human rights due diligence a legal requirement for companies including systems to identify, assess, mitigate or manage human rights risks and impacts to improve that process over time and to disclose the risks and impacts, the steps taken and the results.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity supports a legal requirement within a hybrid hard/soft law framework, calling for direct application while regretting that the Commission dismisses the soft law approach.
The entity states that: 'the Medef regrets that the Commission presents a profile at the expense of business and condemns the approach through soft law, even though this is a complementary to hard law and has the advantage of flexibility'. At the end of the document it points that 'the objective is to arrive at a better level playing field through the establishment of common rules. To this end, a regulation with direct application would be preferable'.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity is in favour of a legal framework for human rights due diligence and elaborates its response following up on existing French law on Duty of vigilance
In its response to question 2, it states that: '‘Medef would favour an EU legal framework providing for obligations to identify risks, prevent and mitigate risks and adverse impacts, and account for measures taken. In this line, Medef believes that this legal framework could be similar to the French law on Duty of vigilance by addressing risks related to human rights and fundamental freedoms, human health and safety and to the environment. On this basis, it would be appropriate for the EU legislation to include the following obligations for companies: Carry out a risk mapping (identification, analysis and prioritization) of salient issues … Put in place actions to mitigate risks and prevent severe impacts … Implement procedures for the assessment of subsidiaries, subcontractors, or suppliers … Set up whistle-blowing mechanisms. Put in place a procedure to monitor implementation measures and evaluate their effectiveness.’
Requiring Human rights due diligence of all companies, regardless of sector and size, while still reflecting their individual circumstances.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity welcomes the Commission's will to see every enterprise take measures to manage the social, health, environmental and economic challenges of its activity, although it seems to advocate for excluding SMEs through 'harmonised exemptions'.
It states that 'The Medef positively welcomes the Commission’s will to see every enterprise take measures to manage the social, health, environmental and economic challenges of its activity. It wants these demands to apply also to public entities and to associations entering thresholds yet to be determined. Specifically regarding SMEs it adds: ‘particular attention will have to be paid to SMEs, with the establishment of harmonised exemptions. The Medef draws the Commission’s attention to the fact that SMEs may also be affected as suppliers or subcontractors to larger firms subject to a duty of vigilance, even though the national laws do not include them in their scope’.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
Although the entity advocates for a horizontal approach covering all sectors, it believes that the legal framework should only affect to companies with more than 5000 employees.
In its response to question 16, it states: ‘Attention will have to be paid to ensure that the administrative and legal burden on SMEs, is not excessive, for instance through the establishment of harmonized exemptions. The EU framework should only apply to large companies and exclude some companies by establishing thresholds (i.e. turnover + number of employees thresholds (over 5000 employees, as in French Law, appears relevant)) to avoid negative consequences on EU SMEs. This is the approach taken by the French law on Duty of Vigilance. Medef draws the Commission’s attention to the fact that SMEs may also be affected as suppliers or subcontractors to larger firms subject to a duty of vigilance, even though the national laws do not include them in their scope. These companies should have lighter reporting requirements.’
Implementing an enforcement mechanism where companies fail to carry out due diligence as described.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity is in favour of judicial enforcement with liability and compensation in case of harm caused by not fulfilling the due diligence obligations.
Although the entity picks judicial enforcement with liability and compensation as an enforcement mechanism (question 19a), it limits the cases of application: '‘Where there is gross failure of a company to put in place reasonable due diligence measures this could be sanctioned by a civil fine. Civil liability should only apply if (i) due diligence has not been carried out and (ii) usual rules of civil liability are satisfied. Criminal sanctions should only apply in case of intentional harm or gross negligence that has a direct link to a serious loss (death, injury, pollution…) as is currently the case under national criminal laws. Injunctive relief should not allow a Court or competent authority to dictate the substance of legislative provisions.’
Including in the duties of directors and company law obligations to avoid human rights impacts or “harms”.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity strongly disagrees with a legal requirement for directors to establish procedures to ensure that risks and impacts on stakeholders are identified, prevented, and addressed. It also disagrees with requiring directors to manage risks for the company in relation to stakeholders and their interests.
In relation to question 7, with which it strongly disagrees, it states that: '‘The board is not responsible for settings procedures, it is the role of the management. Furthermore, given the variety of size, activity and geographical scope of European companies, any EU initiative in this area should allow companies complete flexibility to decide whether and which procedures and targets in this area are appropriate to their business.’ It disagrees to some extent with question 6 regarding directors being required to manage risks in relation to stakeholders: ‘any EU legislative initiative should not lead to personal legal liability for directors and executive officers with respect to company’s impacts on stakeholders’: Also: ‘It should be recalled that many companies will have thousands of stakeholders who are impacted directly or indirectly by their activities (including positive impacts). Moreover, certain stakeholders’ interests will necessarily be contradictory with others. Therefore a “one size fits all” model is not adapted to cope with this objective. Without a focus on salience and the most significant risks, companies’ responses may lack focus and be vague, or contradictory.’
Require companies to provide remedy for human rights impacts they have caused or contributed to.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity advocates for judicial enforcement with liability and compensation in case of harm caused by not fulfilling the due diligence duty obligations, although limited to cases where due diligence didn't take place. It is in favour of grievance mechanisms and remedies.
In its response to question 19a, it states that: '‘Companies should be able to show that they have done appropriate due diligence under an obligation of means. They should not be liable for impacts if reasonable due diligence measures were taken. Companies should have grievance mechanisms in place and remedies should occur close to operations. Where there is gross failure of a company to put in place reasonable due diligence measures this could be sanctioned by a civil fine. Civil liability should only apply if (i) due diligence has not been carried out and (ii) usual rules of civil liability are satisfied.’
Require companies to provide grievance mechanisms for all stakeholders including those in the value chain.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity seems to be in favour of establishing grievance mechanisms, although it is not clear whether it would support making them a requirement, including for all stakeholders
In response to question 20c, which asks whether grievance mechanisms as part of due diligence should be promoted at EU level, the entity does not directly response to this questions, but states that: ‘Companies already organize dialogue with their stakeholders through different initiatives, choosing the mechanism most suitable to their situation and activities, such as: advisory committee, roadshows, direct dialogue, one to one meetings, internal mechanisms, partnerships, co-innovation, panels, etc. It is important that companies remain free to choose mechanisms appropriate to their specific circumstances. Best practices should be made available and promoted. This dialogue is not a matter which would benefit from legally enforced mechanisms. Soft law is working well. Any legal consequences attached to this notion would be counterproductive for companies who need flexibility to adapt their approach to the type of stakeholders, the risks and the geographical scope which are most relevant to their activities.’ On the other hand, when describing the legal framework in question 2, it states that: ‘it would be appropriate for the EU legislation to include the following obligations for companies: … set up whistle-blowing mechanisms’. In its response to question 19a, it also states that ‘companies should have grievance mechanisms in place and remedies should occur close to operations.’ It is not clear the entity’s position, including whether it would make grievance mechanisms available to all stakeholders (it does not take position on the relevance of the different stakeholders presented in the consultation, as per question 5).
Enabling judicial enforcement with liability and compensation in case of harm caused by not fulfilling the due diligence obligations.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity is in favour of judicial enforcement with liability and compensation in case of harm caused by not fulfilling the due diligence obligations, although it limits the cases where it applies.
Although the entity picks judicial enforcement with liability and compensation as enforcement mechanism (question 19a), it limits the cases of application: '‘Where there is gross failure of a company to put in place reasonable due diligence measures this could be sanctioned by a civil fine. Civil liability should only apply if (i) due diligence has not been carried out and (ii) usual rules of civil liability are satisfied. Criminal sanctions should only apply in case of intentional harm or gross negligence that has a direct link to a serious loss (death, injury, pollution…) as is currently the case under national criminal laws. Injunctive relief should not allow a Court or competent authority to dictate the substance of legislative provisions.’
Enable and support effective remedy by allowing victims of the actions of subsidiaries outside the parent company’s home country to sue the parent company if victims are not able to find remedy in their own country.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity takes a position against allowing foreign nationals to directly bring cases before the European national courts.
The entity states (in response to question 19a) that: 'Medef does not agree with the idea that the law should allow foreign nationals to directly bring cases before the European national courts. Courts do not have the sovereign authority to handle such claims, which must be handled before national courts.'
Require companies to implement a due diligence process covering their value chain to identify, prevent, mitigate and remediate human rights impacts and improve that practice over time.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity considers that value chain scope should be limited to principal suppliers and tier 1 subcontractors.
The entity states that it '‘expresses reservations about the establishment of a European duty of vigilance along the whole value chain since companies cannot reasonably be considered liable for the damage caused by other actors in this chain and therefore accept the consequences. The Commission will have to ensure that these demands are proportionate, clearly defined in terms of scope, and reasoned: no performance obligation, prevention adapted to the risks, with a limitation to the principal suppliers and tier 1 subcontractors, and adapted processing of sensitive data. An enterprise should not be held vicariously liable at the risk of undermining both the autonomy of legal persons and the principle of personality for offences and penalties'.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
Although the entity is in favour of a requirement to implement due diligence, including remedies, it is against including all of the value chain.
The entity agrees that a requirement (legal framework) is needed, including a horizontal minimum process and definitions approach. Regarding due diligence duty definition (question 14), it advocates for including safety risks, although disagrees with supply chain definition: ‘we do not agree with this definition which is too broad. In practice, it is impossible for companies to manage all the risks related to their “business relationships” along the whole supply chain. The due diligence duty should focus on the activities on which companies have a reasonable level of control, i.e. only on the company’s own operations, the activities of subsidiaries it controls and first-tier suppliers/ contractors. It would not be appropriate to cover the whole value chain, because that would disproportionately expose companies to liability, for acts over which they have no control, including for how their products are used.’ Also, in response to question 19a, it states that: ‘Companies should have grievance mechanisms in place and remedies should occur close to operations.’
Require that companies identify their stakeholders and their interests.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity disagrees 'to some extent' with a legal requirement (for directors) to identify stakeholders and their interests.
The entity states that: ‘Companies should identify the most relevant stakeholders and the most salient risks in order to implement actions to address those salient risks in priority, including preventing, mitigating and accounting for how they address their potential impacts. However, any provisions of the EU initiative imposing on companies a requirement to carry out an overview of stakeholders’ interests should be flexible enough to reflect the specificity of each company' environment and activities. It should be recalled that many companies will have thousands of stakeholders who are impacted directly or indirectly by their activities (including positive impacts). Moreover, certain stakeholders’ interests will necessarily be contradictory with others. Therefore a “one size fits all” model is not adapted to cope with this objective.’ In addition, it does not take a position in relation to the relevance of a number of stakeholders, including employees and communities in the supply chain, and communities affected by the operations of the company (question 5).
Require directors to establish and apply mechanisms or, where they already exist for employees for example, use existing information and consultation channels for engaging with stakeholders.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity strongly disagrees with a requirement for directors to establish consultation channels for engaging with stakeholders on due diligence.
The entity states that: ‘It should be up to each company to define the scope of its stakeholders and decide the best way to organize the dialogue. This process will ensure that a dialogue occurs with the most relevant stakeholders where companies operate and in the manner which is most appropriate to their needs. Moreover, it is not reasonable to believe that companies can carry out an exhaustive overview of all their stakeholders’ interests. There is no definition of the term “stakeholders” in law and such a definition would be difficult to establish due to the specificity of each company's environment. Thus, we deeply believe that any legal consequences attached to this notion would be highly problematic. Companies usually identify their most relevant stakeholders and identify, prevent, mitigate and account for how they address their impacts.’ In addition, although not explicitly pointed out in the response to this question, the entity opposes the idea that directors should be held legally responsible in these matters.
Require that corporate directors should manage the human rights risks for the company in relation to stakeholders and their interest including on the long run.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity questions measures regarding directors' liabilities.
The entity states that ‘In France, the Medef is promoting this new view of responsible enterprise that further considers the stakeholders’ interests. However, the recognition of an enlightened social interest must not lead to the expanded questioning of directors’ and officers’ liability; the right balance must be found’.
Direct Consultation with Governments
Comments from the entity submitted through official regulatory and legislative consultation processes, or via meetings and other direct engagements with policymakers. Includes evidence obtained by InfluenceMap through Freedom of Information requests.
The entity disagrees 'to some extent' with a legal requirement for directors to manage risks for the company in relation to stakeholders.
In response to question 6 it states that: ‘any provisions of the EU initiative imposing on companies a requirement to carry out an overview of stakeholders’ interests should be flexible enough to reflect the specificity of each company' environment and activities. It should be recalled that many companies will have thousands of stakeholders who are impacted directly or indirectly by their activities (including positive impacts). Moreover, certain stakeholders’ interests will necessarily be contradictory with others. Therefore a “one size fits all” model is not adapted to cope with this objective. Without a focus on salience and the most significant risks, companies’ responses may lack focus and be vague, or contradictory. … any EU legislative initiative should not lead to personal legal liability for directors and executive officers with respect to company’s impacts on stakeholders. … Any liability for failing in relation to a company’s activities should be borne by the company itself and not its directors. … Thus, we deeply believe that any legal liability attached to the need to account for stakeholders’ interests could be highly problematic and difficult for companies to implement.’
| Legislation | Phase of Active Company Engagement | Position |
|---|
| Member | Performance band |
|---|---|
| Engie | E |
