Investors, Investment Funds and New French Law: The Clouded Crystal Ball – Is There Really More Power to Promote CSR?

14 Pages Posted: 23 Jul 2012

See all articles by Ivan Tchotourian

Ivan Tchotourian

Université Laval - Faculty of law; University of Nantes - Faculty of Law and Political Science

Date Written: July 23, 2012

Abstract

The objective of this paper is to present and discuss the new French requirements related to socially responsible investment (SRI), and provide reflections on the potential and limits of regulating SRI. We summarize the consequences of new Monetary and Financial Code Article L. 533-22-1 and the related decree, which have created new obligations for fund portfolio managers. This paper is based on a critical study of the new requirement concerning disclosure by asset management companies: Article L. 533-22-1 of the Monetary and Financial Code and its implementing decree, enacted on January 31, 2012. This paper goes back over the debates following the July 12, 2010 adoption of new French Act No. 2010-788. Our method leads us to observe that France has tried to design a new approach to investment funds in order to favour environmental and societal issues. While the French choice is ambitious and consequently must be seen as significant, the new requirements, which blend “hard law” and transparency, unfortunately raise many questions. New Monetary and Financial Code Article L. 533-22-1 expands the non-financial concerns that asset managers have to take into account. The legislation recognizes that financial investment has an impact on society and the environment, and tries to orient that impact to socially productive ends. Nevertheless, the development of French hard law remains isolated, and serious questions have to be asked about its impact: do these French texts make financial asset managers the potential drivers of change in promoting SRI?

Keywords: CSR, non-financial concerns, financial law, French legislative evolution, Monetary and Financial Code Article L. 533-22-1, asset management companies, collective investment in transferable securities, decree of application, disclosure, consequences

JEL Classification: K22, G18, G38, M40

Suggested Citation

Tchotourian, Ivan, Investors, Investment Funds and New French Law: The Clouded Crystal Ball – Is There Really More Power to Promote CSR? (July 23, 2012). Available at SSRN: https://ssrn.com/abstract=2115835 or http://dx.doi.org/10.2139/ssrn.2115835

Ivan Tchotourian (Contact Author)

Université Laval - Faculty of law ( email )

Pavillon Charles-De Koninck, Local 1111
Quebec, Qc G1V 0A6
Canada
418 656 2131 (2684) (Phone)

HOME PAGE: http://www.fd.ulaval.ca/faculte/professeurs/ivan-tchotourian

University of Nantes - Faculty of Law and Political Science ( email )

Chemin de la Censive du Tertre-BP81307
Nantes, 44313
France

HOME PAGE: http://www.univ-nantes.fr/tchotourian-i

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