If Not Now, When? European Company Law in a Sustainable Development Perspective

Abstract:     
The company, with legal personality, limited liability and transferable shares, is one of the most ingenious inventions of humanity. The company is an all-important vehicle for allocating and efficiently employing capital in our societies, providing goods, services, jobs - and revenue. It is a vehicle for economic efficiency. The most pressing question today is whether company law can only promote economic efficiency in a narrow and short-term sense, which equals environmental degradation, loss of biodiversity and dangerous climate change?

For society, and for shareholders, this could be self-defeating. In the medium term, and certainly in the long run, environmental degradation will amount to economic inefficiency.

How can company lawyers respond to this pressing question? The current section summarises the situation, some implications and the role of the companies in that context. Section 2 sets out the contribution of corporate social responsibility and main stream corporate governance debates. Here, I suggest that we need a new type of responsible corporate governance, and a different role for company law in that respect. Section 3 is devoted to our common European framework, while Section 4 presents the contribution to finding a way forward of the research project ‘Sustainable Companies’.

Number of Pages in PDF File: 20

Keywords: European company law, sustainable development, corporate governance, corporate social responsibility, responsible corporate governance, sustainable companies, IPCC, climate change, Millennium Ecosystem Assessment

Accepted Paper Series