The French PACTE Law or Two-Speed Corporate Social Responsibility (CSR)

Abstract

The French PACTE (Action Plan for Corporate Growth and Transformation) Law of 22 May 2019 (Loi PACTE Plan d’action pour la croissance et la transformation des entreprises. Law no. 2019-486 of 22 May 2019 on Corporate Growth and Transformation, JORF no. 0119 of 23 May 2019) is the kind of far-reaching law commonly adopted in France(Loi TEPA (Law on Labour, Employment and Purchasing Power) of 17 August 2009) with major ambitions to revive corporate growth. Among its many provisions, the amendment of an emblematic article of the French Civil Code is a strong sign in favor of the generalization of CSR, but it seems to establish at two speeds: a cruising speed for the companies already concerned and a crawling speed or “snail’s pace” for the companies that are newly concerned. For the first time, one article, the article 1883 al. 2 Civil Code stipulates that “The company shall be managed according to its corporate interest, taking into consideration the social and environmental issues related to its activity.” Many questions arise as how to implement this article, which kind of sanctions, what about Conventional sanctions: the unknown elements, or the possible role of the judge.