Directive 2014/95/EU of the European Parliament and of the Coun- Coun-cil on the Disclosure of Non-Financial and Diversity Information by

Certain Undertakings and Large Groups

It is the most important directive in the construction of the argumentative theses of this monography, since the choice of establishing a disability manager within each European works council is an indicator of a strategic vision of ‘social’ value, which also becomes the subject of non-financial reporting: this information takes on a ‘rewarding’ meaning from the reputational point of view for the company that adopts this choice, since it is directed towards the financial markets. The directive, also referred to with the acronym NFRD (Non-Financial Reporting Directive), bases the concept of ‘strategic diversity’ of a company as a possible choice, but (if made) subject to mandatory social reporting. The main objective of the directive is to make the economic and financial values of companies in terms of income and assets compatible with the general objectives of civil society and the environment, in order to facilitate sustainable development and long-term growth. In order to make this compatibility traceable and verifiable, large companies are subject to new non-financial reporting requirements in addition to traditional financial reporting. While these obligations do not require promoting recruitment prospects through positive action and combating stereotypes, ensur-ing reasonable accommodation, ensurensur-ing health and safety at work and vocational rehabili-tation programmes in case of chronic illness or accidents, exploring quality jobs in sheltered employment and pathways towards an open labour market.

companies to make social responsibility commitments, they do encourage their adoption: companies are legally responsible for the truthfulness and complete-ness of the non-financial social information they are required to provide relating to their community, environment and employees. Until the new directive came into force, social responsibility statements appeared more as an expression of business marketing strategies than as a verifiable hypothesis of CSR (corporate social responsibility) objectives. The directive in question seems to make the par-ent company (the so-called ‘holding company’) legally ‘responsible’ for the truth-fulness, homogeneity and completeness of the non-financial information pro-vided for the entire European group. Large companies with an average number of employees, during the financial year, of 500 must in fact mandatorily include in their annual report a non-financial statement containing (Art. 1) “at least such environmental, social, personnel and human rights information as is necessary for an understanding of the company’s development, performance, position and the impact of its activities, including: (a) a brief description of the company’s business model; (b) a description of the policies applied by the company regard-ing the above issues, includregard-ing the due diligence procedures applied; (c) the out-come of those policies”. The “brief description of the business model of the enterprise” describes how the enterprise generates and preserves value through its products or services in the long term. The business model provides an in-formative overview of how the enterprise operates and the logic of its structure.

In simpler terms, it explains what the enterprise does, and (most importantly) how and why it does it. The business model allows us, in short, to verify the degree of labour inclusion achieved for the benefit of people with disabilities, and therefore it is essential for it to provide a function of disability/diversity management, perhaps extended to the so-called strategic management: in the composition of the administration, management and control bodies, in order to differentiate the components and combat the so-called ‘groupthink’. In short, the aim of the directive, which introduces new social communication obligations, is not only to extend the company’s duties of social solidarity, but to enrich its capacity and perspective of strategic vision. The important principle that the di-rective introduces is the principle of ‘diversity’. This is interpreted in two ways:

as an enhanced monitoring of information concerning so-called ‘vulnerable groups’ and as a potential area of information concerning so-called ‘strategic par-ticipation’ in the management and control bodies of companies. The first mean-ing has found a precise response in the prescriptive articles of the directive, and consequently in national legislation, offering a strong link with the structure and objectives of this project. The second, more important meaning, however, has remained confined to the recitals of the Directive, and consequently its transpo-sition is not made explicit in the laws of the European States, but only in the European Commission’s Guidelines (Communication from the Commission, Guidelines on non-financial reporting (methodology for reporting non-financial information)),

which describe how to fulfil the obligations to deliver non-financial information.

Technically, these Guidelines are therefore not prescriptive but offer models of potential regulatory ‘compliance’ according to the logic of the ‘risk approach’. In any case, the Directive offers a very acute concept of diversity, projected onto the strategic composition of companies’ governing bodies, in order to ensure the development of autonomous, independent, original, creative and professional business thinking. The lack of diversity and adequate skills (in terms of profes-sional preparation, knowledge and individual talent) inevitably leads to a lack of innovative ideas, discourages criticism and in fact results in a corporate manage-ment that is not suited to compatible long-term developmanage-ment. Recital 18 states:

“diversity of skills and points of view […] makes it possible to challenge man-agement decisions constructively and to be more open to innovative ideas, thus combating the standardisation of members’ opinions, the so-called groupthink phenomenon. It therefore contributes to effective management oversight and efficient corporate governance”. Social homologation (intended as a business risk factor) is nowadays plastically evident in the composition of the boards of public and private companies, whose members have known each other for years, also have a similar educational background and usually belong to the same gen-der and, even more, share the same ‘standard skills’. Already in 2011, the Euro-pean Commission, in its Communication Action Plan: EuroEuro-pean company law and corporate governance – a modern legal framework for more engaged shareholders and sustainable companies (COM(2012)740 final), considered that a lack of diversity on the board results in “a lack of debate, ideas and critical thinking on the board and poten-tially less effective control by the management board or executive directors”. The concept of ‘diversity’, therefore, applied not only to the issue of gender, but also to disability (rectius: different abilities), is not at all a forced reading of the legisla-tion, but is contained in the Principles of the Charter of Fundamental Rights of the European Union (as an explication of the principle of equality: non-discrim-ination, equality between men and women, inclusion of the disabled). In this sense, Art. 1 requires the companies concerned to disclose in their corporate governance statement: “a description of the diversity policy applied in relation to the composition of the administrative, management and supervisory bodies of the company with respect to such matters as age, sex, or educational and pro-fessional background, the objectives of the diversity policy, the manner of its implementation and its results during the reference period. If no such policy is applied, the statement shall contain an explanation of why this is the case” (this is the ‘comply or explain’ rule). These aspects of diversity, which can be traced back to the management policy, should be specifically reported, moving from statements of principle to the criteria for application and the way in which they are implemented. In fact, the description of the diversity policy should specify which diversity criteria are applied, as well as explain the reasons for their selec-tion. When choosing these criteria, all relevant diversity aspects should be taken

into account in order to ensure that the board has a sufficient diversity of view-points and expertise, which is necessary for a good understanding of the current business and the long-term risks and opportunities related to the company’s ac-tivity. The nature and complexity of the company’s business should also be taken into account when assessing the profiles needed to ensure optimal board diver-sity. This management diversity, associated with the effects of employee partici-pation in the control system (the so-called extended governance), echoes to some extent the regulatory tool of whistleblowing (⁷). Furthermore, Art. 1 of the Di-rective states that the non-financial statement should contain information, in-cluding “the result of those policies”. The information disclosed by companies should thus help investors and other interested parties to understand and moni-tor the company’s performance, also with a view to declared inclusiveness. From this it emerges that the directive also reinforces the meaning of the action of EWCs, which notoriously act through “consultation”, on the substratum of “in-formation” promptly available to them by multinational companies, as enshrined in Directive 2009/38/EC. In particular, the legal technique adopted by the EU legislator consisting in the obligation to ‘comply or explain’ appears extraordi-narily suitable for certifying the quality of the information provided to the EWC in that, in the event of failure and unjustified fulfilment of the information obli-gation by the parent company, it can certify the omission of information that is the subject of an unsatisfactory negotiation consultation, and even justify a pos-sible appeal to the European Court of Justice for violation of the rights to infor-mation and consultation. Ultimately, this opens up unexpected scenarios for more effective protection and integration of people with disabilities in the work-place.

Art. 2 of the directive refers to Communication Guidelines and states that “the Commission [shall develop] non-binding guidelines on the methodology for the communication of non-financial information, including general and sectoral key performance indicators, with a view to facilitating relevant, useful and compara-ble disclosure of non-financial information by companies”. The Commission’s stringent Guidelines, although not formally part of the Directive and despite the fact that they do not constitute prescriptive part of it (they are non-binding guidelines, unlike the requirements of the Directive), make it possible to verify the ex post consistency of the non-financial statements made by companies. They provide for some priorities. 1) Materiality of information. In assessing the materiality of information, several factors may be taken into account, including: business model, strategy and key risks, major industry issues, interests and expectations of (⁷) On 23 October 2019, the European Parliament and the Council adopted Directive 2019/1937 on “the protection of persons who report breaches of Union law”. This Directive establishes common minimum standards aimed at ensuring the protection of the so-called whistleblowers in the legal systems of the Member States, and will be their indispensable regulatory reference point.

stakeholders. 2) Fair, balanced and understandable information. The non-financial statement should give fair consideration to both favourable and unfavourable aspects and the information should be presented in an unbiased manner. The statement should take into account the information needs of interested parties, who should not be misled by incorrect or omitted material information, or by the provision of irrelevant information. The non-financial statement should clearly distinguish facts from views and interpretations. Information should be fairer and more accurate, for example: through appropriate corporate govern-ance arrangements; robust and reliable evidence; internal control and reporting;

effective involvement of stakeholders. 3) Complete but concise information. 4) Strategic and forward-looking information. The statement should explain the short-, medium- and long-term implications of the information disclosed. 5) Stakeholder-oriented information. Companies should consider the information needs of all stakeholders.

They should focus on the needs of stakeholders as a collective group rather than on the needs or preferences of atypical or unreasonably demanding individuals or stakeholders. These include: investors, workers, consumers, suppliers, custom-ers, local communities, public authorities, vulnerable groups, social partners and civil society. 6) Information on social and personnel issues. Companies are required to provide relevant information on: implementation of core International Labour Organisation conventions, diversity and equal treatment issues in the context of employment (including age and disability aspects); employment-related issues, including consultation and/or participation of workers, employment and work-ing conditions; labour relations, includwork-ing respect for trade union rights; human capital management, including restructuring management, career management and employability, remuneration system, training; occupational health and safety;

impact on vulnerable consumers; responsible marketing and research; commu-nity relations, including social and economic development of local communities.