Back in January I wrote about how I believed mandatory CSR reporting was going to come into the EU’s regulatory frame work under the auspices of the Single Market Act (SMA), which is on schedule for adoption by the end of this year.
In brief, the EU has said it by 2014 it will provide a “legislative proposal on the transparency of the social and environmental information provided by businesses” which apply to large companies, such as those with over 1,000 employees. Read New CSR Regulation Coming Your Way for more details.
Now, it may have skipped your notice but this month saw the 20th anniversary of the EU’s Single Market (the Maastricht Treaty, when the EEC became the EC). To celebrate it the EU launched a debate entitled “Europe, Wake Up! We will only return to growth and prosperity if we complete the the Single Market”, including this video and this Google hangout.
In the best tradition of Hollywood slasher/romcom/fantasy flicks (delete as appropriate) it also launched SMA The Sequel, more properly known as the Single Market Act II.
This addresses several key areas for which the European Commission considers to be priorities for rapid adoption to try and stimulate the EU out of the current economic crisis. Proposals in these areas will be put forward in 2012-14.
Those areas are:
- transport: integrating rail, sea and air networks to allow freer movement of goods and passengers and implementation of services to cross borders;
- energy: implementing and enforcing new rules to promote renewables and enable cross border markets
- citizens: make it easier for EU citizens to work in another state
- business and finance: revise (ie. relax) insolvency rules and legislate to encourage long term investment
- digital economy: stimulate broadband efficiency and electronic invoicing / payments
- consumers: harmonise EU wide safety standards and legislate to ensure all citizens have bank accounts with clear fees.
On the face of it there’s little in this which directly affects CSR but if you look at it from the wider point of view it is inevitable that the regulatory tendrils of these single market changes will have an impact on it.
Take long term finance as an example, which is bound to have an effect on CSR’s first cousin SRI. If this is going to involve regulation then how a business’ performance at board level is measured is going to change radically towards and ESG model. Surely this will require further regulatory action to ensure that performance can be measured equally across all EU businesses?
Whether the UK is in or out of this European State is almost beside the point. With the EU representing the UK’s largest trading partner the changes will affect us one way or another, and they will affect us all sooner than you may think.
Picture Credit: European Union Flag by Yanni Koutsomitis / CC BY.
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