/>iOn 16 October 2024, the French Anti-Corruption Agency (AFA)[1] published guidance intended to help entities, subject to the Corporate Reporting Sustainability Directive (CSRD)[2], report on their antibribery and corruption (ABC) compliance program.
Under the European Sustainability Reporting Standards (ESRS)[3] G1 – Business conduct and ESRS 2 requirements, companies are required to report on their ABC compliance program. However, a lot of companies subject to CSRD are not yet subject to any ABC legislation.
The AFA explains that this guidance was designed to support companies that do not meet the French Sapin II law[4] thresholds to progressively implement tailored compliance measures. In other words, the AFA considers that the reporting standards set out by the CSRD trigger an obligation to effectively implement an ABC program compliant with the Sapin II requirements. The AFA’s position is even broader since it published a statement indicating that:
“Companies that have not voluntarily developed measures to prevent and detect corruption will have to indicate this and demonstrate their willingness to do so. The AFA therefore considers that it is in the best interests of these companies to progressively equip themselves with anti-corruption measures, as this will bring them many benefits.”
Therefore, the AFA has indicated that companies should report the absence of an ABC program and indicate whether and when they will implement such measures.
The AFA comments on the 8 ABC pillars required by the Sapin II Law to set out the interoperability with the CSRD reporting.
| ABC Measures required by Sapin II Law | CSRD disclosure requirements |
| Management commitment | G1-3: System to prevent and detect corruption G1-3: Corporate communication on ABC policies |
| Documented risk mapping updated from time to time |
G1-1: Mechanism for identifying and reporting breaches of the code of conduct
|
| A code of conduct | G1-1: Mechanism for identifying and reporting breaches of the code of conduct G1-3: Corporate communication on anti-corruption policies |
| Training specific anti-corruption risks |
G1-1: Mechanism for identifying and reporting breaches of the code of conduct
AFA recommends reporting on:
|
| Third-party due diligence |
G1-1: Mechanism for identifying and reporting breaches of the code of conduct
G1-4: Information whose publication is optional – proven cases of corruption |
| An internal whistleblowing system as well as effective protection of whistleblowers |
G1-1: Mechanism for identifying and reporting breaches of the code of conduct
G1-4: Information whose publication is optional – proven cases of corruption |
| An internal control and evaluation system for the measures implemented | G1-1: Mechanism for identifying and reporting breaches of the code of conduct G1-3 : Corporate communication on anti-corruption policies |
| Internal and external accounting control procedures | G1-1: Mechanism for identifying and reporting breaches of the code of conduct G1-3: Corporate communication on anti-corruption policies |
| A disciplinary regime enabling accountability for breaches of the company’s code of conduct by employees |
G1-1 :
G1-3 :
G1-4: Information whose publication is optional – proven cases of corruption AFA recommends reporting on:
|
Although the position taken by the AFA vis-à-vis corporates not subject to Sapin II is challengeable, the interoperability between ABC compliance measures and ESG reporting obligations is likely to simplify the reporting workstream and is cost-efficient (i.e., positive impact on the governance, time savings (on data collection and transcription) and data reliability, as the AFA underlines it).
Finally, this should facilitate third party due diligence and provide visibility to investors in corporate transactions.
[1] The AFA provides advice, assistance and has administrative powers of control enabling it to verify the reality and effectiveness of ABC mechanisms implemented by entities subject to Sapin II Law.
[2] Directive (EU) 2022/2464 of the European Parliament and of the Council of December 14, 2022 amending Regulation (EU) No 537/2014, Directive 2004/109/EC, Directive 2006/43/EC and Directive 2013/34/EU, as regards corporate sustainability reporting (CSRD – Corporate sustainability reporting directive).
[3] https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=OJ:L_202302772. Delegated Regulation (EU) 2023/2772 of 31 July 2023 supplementing Directive 2013/34/EU of the European Parliament and of the Council. The information included in the sustainability report should comply with the European Sustainability Reporting Standards (“ESRS”) and include (1) the methodology to be adopted as part of the double materiality analysis; (2) the mandatory information that must be reported under the CSRD; (3) the data collection methodology; (4) the preparation of the sustainability report; and (5) the follow-up and updating of the sustainability report.
[4] Law 2016-1691 of December 9, 2016 on transparency, the fight against corruption and the modernization of economic life. Thresholds are as follows: companies with 500 employees, whose turnover or consolidated turnover exceeds €100 million having its registered office based in France
