Implementing CSR-RUG in companies – a guide for employee representatives

Corporate reporting on social and environmental issues has become increasingly important in recent years. Sustainability reporting is a voluntary corporate service. However, since the 2017 financial year, large capital market-driven companies, credit institutions and insurance companies have been legally obliged to disclose the social and environmental impact of their business activities on an annual basis.

The basis for this is the “Act to Strengthen Non-Financial Reporting by Companies in their Management Reports and Group Management Reports” (also known in Germany as the CSR Directive Implementation Act or CSR-RUG). It transposed the Europe-wide CSR Directive 2014/95/EU on the expansion of financial reporting to include non-financial and diversity aspects into national law.

This reporting obligation aims to meet the information needs of various interest groups and to steer the economy in a more sustainable direction. In particular, companies that have not yet published sustainability reports shall be obliged to provide information. On the other hand, with this law also comes the expectation that companies – not least as a result of internal and external pressure – will increase their business activities with regard to non-financial aspects.

Germany’s CSR-RUG Act not only presents trade unions and employee representatives with new tasks ensuing from the audit obligations of supervisory boards, it also raises the question as to what potential for co-determination arises from the law and how this potential is used.

The guide for employee representatives provides guidance on the legal requirements, contains explanations and tips on their implementation, and refers to practical examples.

A checklist and thematically arranged literature references provide help in engaging in the topic and facilitate further research. The guide is aimed at both employee representatives on supervisory boards and works councils in local, national and European bodies. It is intended as an information source, reference work and stimulus for discussion at committee level, in order to influence the companies’ sustainability activities and strengthen them in the interest of the employees.

The publication is planned for September 2020.