FRANCE Trends and Developments Contributed by: Saam Golshani, Diane Lamarche, Félix Thillaye and Victoire Segard, White & Case LLP
Financial Centre ( Haut Comité Juridique de la Place Financière de Paris – HCJP), clarifying the applicable legal framework for advisory shareholder votes on the environmental policies of listed companies. The main conclusion of the HCJP, which issued its report in December 2022, is that French law is suf- ficiently clear regarding the validity of non-binding advisory shareholders’ votes on the climate strategy of issuers. The report therefore states that French law does not require any amendments from that point of view. However, in the same vein as the ANSA, the HCJP considers that French law does not enable share- holders to impose a climate strategy on a board of directors. Notably, the report clearly highlights that shareholder resolutions aimed at forcing the board of directors to align the company’s strategy with the objectives of the Paris Agreement would be contrary to French corporate law. Following this report from the HCJP, several members of the French national assem- bly submitted a series of amendments in July 2023, aimed at introducing an obligation for listed compa- nies to submit to their AGM an advisory resolution on climate and sustainability strategy every three years, and to submit an advisory resolution to approve the annual report on the implementation of climate and sustainability strategy every year. These amendments were finally rejected, but a new law enacted on 13 June 2024 ( Loi visant à accroître le financement des entreprises et l’attractivité de la France ) clarified the procedural regime allowing share- holders to challenge a refusal from the board of direc- tors to add a resolution to the agenda. Dedicated fast- track proceedings on the merits are now available in such cases, offering shareholders more legal certainty before French courts in the event of a legal action.
In addition, a further HCJP report of 6 December 2024 addressed the issue of the withdrawal of resolutions already placed on the agenda of a general meeting. This topic can be particularly relevant in an activist context: removing a shareholder-sponsored resolu- tion can limit shareholders rights, while boards may use withdrawal strategically to avoid a public defeat. The HCJP emphasised that such withdrawals should remain possible but must be accompanied by clear and timely disclosure of the reasons justifying it to shareholders and the market, in order to safeguard transparency and reduce litigation risks. Conclusion In line with most expert reports, major legislative amendments will probably not materialise in the com- ing months. Rather, it is probable that the current trend of minor and targeted amendments to the applicable French law will continue – together with soft law rec- ommendations. This is consistent with the AMF’s position, pursuant to which “[A]ny additional regulations specific to the Paris marketplace, notably regulations significantly increasing the obligations incumbent on all the market participants, including investors, might have undesir- able effects, especially concerning its attractiveness”. Given recent trends and the 2025 decision issued by the Court of Appeal in the Vivendi case, however, activists may seek to exploit the legal uncertainties left by this incremental approach to influence corporate decisions through litigation and judicial activism. That said, French courts have traditionally taken a strict stance against activist strategies, as illustrated by the significant financial penalty imposed by the Paris Commercial Court on CIAM at the end of 2024 ear- lier on in the same Vivendi case, where the fund had sought to postpone Vivendi’s general meeting con- vened to decide on its spin off.
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