The Struggle Over the EU Non-Financial Disclosure Directive

WSI-Mitteilungen 8/2015, pp. 613-621

12 Pages Posted: 6 Jun 2015 Last revised: 23 Sep 2019

See all articles by Daniel P. Kinderman

Daniel P. Kinderman

University of Delaware - Political Science & International Relations

Date Written: June 1, 2015

Abstract

A new EU Directive represents an important step towards greater corporate accountability: it will require large companies to report on their social, environmental and human rights impacts and the risks their activities pose for third parties. While the circumstances leading to the Directive were favorable, the final text was weakened significantly as a result of opposition from business, German business in particular. This contribution examines the political struggles over the EU’s Non-Financial Reporting Directive and seeks to explain the positions of different countries and interest groups in the negotiations. It identifies domestic regulations as a sufficient but not a necessary condition for support of the Directive. It also suggests that Germany’s particularly fierce resistance is attributable at least in part to the size and influence of Germany’s Mittelstand or medium-size enterprise sector.

For an updated and more theoretically and empirically sophisticated version of this paper, please see "The Challenges of Upward Regulatory Harmonization: The Case of Sustainability Reporting in the European Union" https://ssrn.com/abstract=3340646 as well as "The tenuous link between CSR performance and support for regulation: Business associations and Nordic regulatory preferences regarding the corporate transparency law 2014/95/EU" https://ssrn.com/abstract=3451630

Keywords: CSR, European Union, non-financial reporting, regulation, regulatory harmonization, sustainability

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JEL Classification: M14, M41, K32

Suggested Citation

Kinderman, Daniel P., The Struggle Over the EU Non-Financial Disclosure Directive (June 1, 2015). WSI-Mitteilungen 8/2015, pp. 613-621, Available at SSRN: https://ssrn.com/abstract=2614983

Daniel P. Kinderman (Contact Author)

University of Delaware - Political Science & International Relations ( email )

United States

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