Introduction

This chapter analyses the impact of a number of ‘labour law’ directives on corporate governance. Informing and consulting employees about issues which affect their interests, as well as employee participation in corporate decision-making, has been a controversial aspect of the Community's regulatory agenda since the 1970s. Procedural rights of this kind blur the distinction between corporate governance and labour law and remain central to the Community's regulatory agenda. Combined with the reflexive turn taken in a number of recent regulatory instruments, the Community's continuing insistence that corporate decision-making must be regulated because of its impact on employee interests means that EC corporate governance regulation transcends the pure shareholder value model which is found in so many corporate governance codes at national level.

We saw in chapter 4 that the company law harmonisation programme proceeded on the basis that prescriptive harmonisation of all aspects of company law, including employee participation, was required to further market integration. As a matter of policy, re-regulation of national law would be protective of employee interests, and early proposals for a Fifth Company Law Directive and a European Company Statute (ECS) were highly prescriptive. In contrast to this approach to company law, there was little or no Community intervention in the labour law of the Member States before the 1970s, it being anticipated that market integration would drive convergence of the labour law and social policy of the Member States.