Sustainability objectives and corporate life
As sustainable development is now an imperative for governments, it is clear that sustainability objectives are impacting businesses and their managing bodies under Italian law.
In fact, certain new regulations have already introduced the concept of sustainability to business management, albeit primarily limited to providing relevant information in certain specific instances, including:
(i) Legislative decree n. 254 of 2016, which implements Directive 2014/95/EU on the disclosure of non-financial and diversity information, requiring large companies that qualify as relevant public interest entities to draw up and publish a so-called “non-financial statement”, which must contain information relating to their support for environmental, social and personnel issues, respect for human rights and anti-corruption measures. These rules are binding on the company and its directors and carry penalties for failure to provide information, or for providing inaccurate information, to the market; and
(ii) Directive 2017/828/EU which promotes long-term shareholder engagement, implemented in Italian law by legislative decree n. 29 of 2019 (the “Shareholders Rights Directive 2”), which – with reference to the remuneration policies of directors and management – sets out an obligation to provide evidence of the connection between such policies and the “corporate strategy, long-term interests and sustainability of the company”.