Companies

Beware the moralisation of companies by judges

2 MIN

Following the Senard-Notat report of March 2018, the so-called “PACTE” bill aims to regard companies as “objects of collective interest”. This reform would introduce a significant conceptual change in our law system.

Changing the articles 1832 and 1833 of the French civil code would mark a non-trivial legal break regarding companies’ role in society. This reform, if implemented, will impact all companies regardless of their size or sector of activity.

The judge alone will be given the responsibility to interpret whether and how “social and “environmental stakes” are relevant. The relationship between companies and stakeholders could increasingly be decided in court.

This reform marks the abdication of the state to regulate externalities, handing the task to assess companies’ actions over to a judge.

Based on the principles of the rule of law, we stand firm against this reform from a philosophical, economic and, of course, legal point of view.

Our report also explains the differences between the so-called “social object” and “social interest” of companies and suggests to change the civil code in a more subtle way, i.e. without jeopardizing the rule of law.