Filip Gregor
Head of the Responsible Companies Team
The European Parliament approved last weekthe proposed college of Commissioners. Věra Jourová successfully faced the public grilling and will become the Commissioner for Justice, Consumers and Gender Equality. Due to the shift of competencies within the Commission, Ms. Jourová will have an opportunity to influence the governance and rules of the game for multinational corporations.
As part of the re-organization of the European Commission, a surprising and crucial change was made. Corporate Governance and Social Responsibility was removed from Directorate General for Internal Market and Services and transferred to Jourová’s Directorate for Justice. The British Institute of Directors, as well as its European equivalent, protested against the move. The purpose of the rules set in this area is to ensure, in the words of the IoD, that both small and giant companies are healthy, competitive and behave ethically.
After the 2008 financial crisis, the current model of corporate governance built on the maximization of shareholder value was criticized by many as a root cause of the crisis and a source of many undesirable behaviors such as fixating on short-term financial goals, accounting manipulation, avoiding tax duties and the inability of big corporations to behave responsibly towards their employees, consumers and society at large. According to various analysts, this behavior is destructive for corporations and the economy as a whole.
European states are struggling to deal with the macro-economic consequences of the crisis and considering potential reforms of the financial market. At the same time, the European Commission – and Ms. Jourová's department specifically – faces another great challenge: how to react to the causes of the economic crises, which are deep-rooted in our current approach to corporate governance. The good news is that relevant experts from business, academia and civil society have already started to discuss ways forward. At the EU level, this discussion is organised in particular by the “The Purpose of the Corporation” Project.
A second great challenge for the new Commissioner will be harmonization of access to justice. The last Commission discussed, for example, an EU initiative on collective redress in consumer and anti-competitive cases. A new dimension to this discussion added three years ago was the unanimous endorsement of the Guiding Principles for Business and Human Rights by all 47 members of the United Nations Human Rights Council. One of the three pillars of these principles is ‘Access to Justice’. EU Member States and the Commission have announced their commitment to implement them. At the European Commission, it should be Věra Jourová's Directorate General for Justice that will be responsible for this process. The Commissioner would be well-served to benefit from the existing debate in this field.
A conference hosted at EU Parliament on 12 November will present the results of the expert report “The Third Pillar: Access to Judicial Remedies for Human Rights Violations by Transnational Business” and engage participants in a discussion of the potential solutions to improve access to justice in the EU for business-related abuses of human rights and the environment. More information here.
Filip Gregor, Head of the Responsible Companies section, Frank Bold
Paige Morrow, Head of Brussels Operations, Frank Bold
Prague Municipal Court ruled today in favour better protection of human health from air pollution in the capital of the Czech Republic. The Court revoked most of Prague's Air Quality Management Plan, issued in 2016 by the Czech Ministry of Environment.
Czech Supreme Administrative Court ruled yesterday in favour of air quality and protection of human health. In the case local citizens and an NGO from Ostrava agglomeration, the most polluted region in the Czech Republic, succeeded with their claim for better air quality.
Yesterday, on 5 November 2018, a lawsuit against the Ministry of the Environment (MoE) on liability for health damages and death of her husband from lung cancer was filed with the District Court in Prague 10. The plaintiff seeks damages for lung cancer, which she has managed to cure, but her husband has succumbed to the illness in October. The cause of the disease is seen in the long-term excessive concentration of air pollutants at their place of residence in Ostrava-Radvanice and in the fact that the MoE failed to provide effective measures to decrease the pollution to legal limit values.
