ERU, Alm.del - 2020-21 - Bilag 21: EMs orienteringsnotat samt høringssvar vedr. EU-initiativ om bæredygtig virksomhedsledelse, fra erhvervsministeren

Erhvervsudvalget 2020-21
ERU Alm.del Bilag 21
Offentligt

NOTE

5. October 2020

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The Danish Government’s response to the public consultation on

roadmap on sustainable corporate governance

It is a key priority for the Danish Government to enable a green and sus-

tainable transformation of the society and accordingly the Danish govern-

ment has set an ambitious target to reduce CO2 emissions by 70 % in 2030.

Private companies play a vital role in order to fulfil the ambitions of the

Paris agreement, to fulfil the UN sustainable development goals, the pur-

pose of the UN guiding principles for business and human rights and the

OECD guidelines for responsible business conduct.

The Danish Government strongly supports the initiative of the Commission

in the European Green Deal to address how private companies can be fur-

ther encouraged to structure decisions in terms of sustainability. We appre-

ciate the opportunity to comment on the Commission’s roadmap consulta-

tion. Responsible business conduct is and must be part of the companies'

core business strategy. Large companies in particular have a special respon-

sibility to lift sustainability and human rights on a global level because they

have a greater influence on conditions in their supply chains.

This initiative is closely linked to existing and parallel initiatives pursuant

to the sustainable finance strategy. There will be a close link between the

upcoming revision of the Non-Financial Reporting Directive (NFRD) and

possible new disclosure requirements regarding due diligence processes as

well as

board and director’s duties following this

initiative. The Danish

Government strongly urges the Commission to ensure a coordinated pro-

cess for both initiatives that also allows for careful discussions with the

Council and Parliament about what to disclose.

Due diligence

The Danish Government appreciates and strongly supports the Commis-

sion's intentions to address how companies can be encouraged to carry out

due diligence processes in line with the international guidelines. The Dan-

ish Government finds that a harmonized EU approach to responsible busi-

ness conduct including regulating due diligence processes is a necessary

step in order to ensure that companies integrate their environmental and

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human rights risks and impacts into their corporate strategies. A harmo-

nized EU approach could also address the number of different national leg-

islative initiatives that are already in place or on their way. The Danish

Government believes that the regulation of due diligence processes to be

best addressed at the EU level in order to ensure a level playing field.

While supporting the regulation of due diligence processes the Danish Gov-

ernment would also like to encourage the Commission to look at voluntary

measures in order to find a

‘smart

mix’ to address the current challenges

since the issue of due diligence involves a range of complex legal and prac-

tical challenges.

The Danish Government also urges the Commissions to take into consid-

eration when drafting the proposal, the question of proportionality and the

leverage of businesses to prevent or mitigate adverse impact, which will

differ depending on factors such as operational milieu and business size.

Sustainable corporate governance

The Danish Government acknowledges with appreciation the Commis-

sion's intentions to address how companies can be encouraged to make cor-

porate decisions with longer time horizons in order to foster a sustainable

development for the society, companies, citizens and employees. In order

to achieve e.g. the goals of the Paris agreement on climate change it is es-

sential that business contribute to sustainable development. The Danish

government believes that sustainability, growth and competitiveness must

be aligned and not be contradictions.

The Danish Government agrees with the Commission that it is necessary

to empower directors to further integrate a wider range of interests into

corporate decision-making than just the interests of the shareholders in or-

der to avoid a narrow focus on the short term. This includes but is not lim-

ited to the interests of employees and the environment.

The Danish Government acknowledges that a proposal to regulate direc-

tors’

duties involves a number of complex legal challenges as member

states' company legislation and corporate governance codes contain differ-

ences that reflect the differences in the individual member states, including

the companies' ownership and management structures. It is important that

the Commission considers this when drafting a proposal in order to identify

a workable model. The Danish Government therefore finds that the Com-

mission should make sure that all consequences and challenges are ana-

lyzed and studied before concrete proposals are adopted.

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Process of the initiative

Both lines of action described in the roadmap will no doubt encompass new

and novel approaches including possible regulatory instruments. A com-

prehensive analysis of these instruments and their foreseen consequences

is vital. It should include both factual assessment of all legal and economic

aspects as well as broad stakeholder consultation. Proportional solutions

require thorough knowledge of stakeholders’ view and circumstances.

Hence, we urge the Commission to consider how to achieve a broad out-

reach in the consultation as many companies especially

SME’s are not suf-

ficiently aware of the challenges at hand.

The Danish Government stands ready to contribute throughout the process.