Key CSR laws for businesses: LOM Law, Climate Law, Taxonomy, and the PACTE Law. All the details and regulations are explained in this article.
The law of August 22, 2021, focuses on combating climate change and strengthening resilience to its effects. The goal is to accelerate the ecological transition of French society and the economy.
- Consumption
- Production and work
- Transportation
- Housing
- Food
It requires the State to meet the European target of a 55% reduction in greenhouse gas emissions by 2030. The Climate Law imposes specific regulations on companies to reduce their environmental impact.
Starting in March 2022, advertisements for the automotive and home appliance sectors will be required to display a “carbon score,” an energy label, or, for cars, a carbon dioxide emissions class.
Advertising via banner-towing aircraft will be banned as of October 1, 2022. Finally, by July 1, 2022, at the latest, the distribution of samples “without a request from the consumer” is prohibited.
A proposal has been made to make the eco-score mandatory, which is an environmental label created to inform consumers about the impact of products and services, particularly on the climate.
New buildings with a footprint of over 1,000 m² (dedicated to commercial, industrial, artisanal, or covered public parking use) are required to green or install renewable energy production systems on 30% of their roof surface or on newly created parking lot shades.
Starting July 1, 2023, this requirement will be extended to commercial, logistics, and artisanal buildings over 500 m² and office buildings over 1,000 m².
Furthermore, the Climate Law grants the Social and Economic Committee (CSE) new powers regarding environmental issues.
The Climate Law adds a sustainable mobility allowance of €600/year for employees.
—> The Climate Law requires companies with more than 50 employees and at least one union representative to include the topic of home-to-work commuting in their mandatory annual negotiations.
Companies are required to include transport-related GHG emissions (upstream/downstream) in their non-financial performance statement (DPEF) and link them to an action plan.
Companies subject to the DPEF:
- Listed companies with over 500 employees
- (Revenue over €40M and a balance sheet of €20M)
- Unlisted companies with over 500 employees
- (Revenue and balance sheet over €100M)
- Organizations in the credit, insurance, and mutual sectors based on specific criteria.
The climate law includes many measures, each targeting a specific category of company. You should refer to the regulations for details.
The green taxonomy is a classification system for economic activities that have a positive impact on the environment. The goal is to set a CO2 emission threshold below which a company is considered green.
- Climate change mitigation
- Climate change adaptation
- Sustainable use and protection of water and marine resources
- Transition to a circular economy
- Pollution prevention and control
- Protection and restoration of biodiversity and ecosystems
The green taxonomy allows for the assessment of 90 economic activities, representing over 93% of EU GHG emissions, across 3 activity levels :
- Companies with over 500 employees already subject to the DPEF
- (Balance sheet must be under €20M and turnover under €40M)
- Companies with over 250 employees subject to the CSRD
- (Balance sheet must be under €20M and turnover under €40M)
- Listed companies
- (excluding listed micro-enterprises)
Mandatory reporting of taxonomy-eligible activities and investments for all companies covered by the regulation (2021 financial year)
Publication of the application report for the green taxonomy.
- Entry into force of regulations concerning pollution, water, biodiversity, and the circular economy
- Mandatory reporting of taxonomy-alignment for large companies
- Mandatory reporting of taxonomy-alignment for investments by financial institutions
- Companies subject to the CSRD must comply with the Green Taxonomy (2024 financial year)
The LOM Law is the Mobility Orientation Law published on December 24, 2019.
- The isolation of rural areas
- Excessive reliance on polluting vehicles
- The environmental and climate emergency
The goals of the LOM Law will help tangibly improve daily commutes for all citizens across all regions through more accessible transport solutions that are better suited to diverse needs and are more eco-friendly.
In the absence of an agreement on measures to improve employee home-to-work commutes, companies with more than 50 employees must develop a PDM: an Employer Mobility Plan. This involves assessing existing transport options by analyzing employee commutes and creating an action plan to optimize them.
To better understand how your team gets to work and what barriers prevent them from using greener transport options, you can set up an online survey (using tools like Google Forms).
A few ideas for actions to implement under the LOM Law:
- Increase reimbursement rates or cover 100% of subscriptions for soft mobility options.
- Promote cycling.
- Adjust working hours to align with public transport schedules.
- Guarantee a way home in case of transport or carpooling issues using taxi vouchers, company cars, etc.
- Connect employees for carpooling.
Thanks to the LOM Law, employers can contribute to employees' personal home-to-work travel expenses through the sustainable mobility allowance (€500/year, or €600/year if combined with a public transport subscription). This contribution is exempt from income tax and social security contributions.
Eligible modes of transport include:
- Bicycles, whether electric or manual;
- Cars used for carpooling (as either driver or passenger);
- Personal mobility devices (motorized or not) available for rent or self-service (such as "free-floating" electric scooters and bikes);
- Public transport, excluding subscription costs;
- and any other shared mobility service.
Under the LOM law, companies managing more than 100 light vehicles must allocate a minimum quota of low-CO2 emission vehicles when renewing their fleet annually:
- 10% of this renewal starting January 1, 2022;
- 20% of this renewal starting January 1, 2024;
- 40% of this renewal starting January 1, 2027;
- 70% of this renewal starting January 1, 2030.
The PACTE law is the Action Plan for Business Growth and Transformation proposed in May 2019.
The PACTE law is designed to remove obstacles to business growth. Furthermore, it aims to increase the consideration of social and environmental issues in corporate strategy.
Discover our White Paper: 2023 Overview of Corporate CSR Regulations.
Photo by Tingey Injury Law Firm on Unsplash
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