On 24 November 2017, after considerable delay, Spain approved Royal Decree Law 18/2017, which incorporates into legislation the terms of Directive 2014/95/EU as regards disclosure of non-financial and diversity information by certain large undertakings and groups.
This news should cause great joy, because it indicates that both European and national policies are moving toward concrete actions by our companies to improve our environment and to guarantee gender equality and respect for human rights. Nevertheless the excessive flexibility that companies have to meet this new obligation –along with imprecision about the information that such companies must provide in their annual reports– raises concern that this new legislation will not have the desired impact.
While it appears that the State has sought to do as little as possible in complying with the required transposition, it is to be hoped that the companies themselves will voluntarily assume this new minimum obligation as an opportunity to consolidate and make visible their policies on equality and in promoting diversity in their work forces. The explanatory preamble of the reasons for the new rule encourages us to integrate different national and international regulatory frameworks so as to achieve this aim. Therefore I would like to mention initiatives like the United Nations Global Pact or the Guiding Principles on Business and Human Rights, which were developed in the UN to “protect, respect and remedy.”
Companies in general, but especially the small and medium-sized firms, should be made aware of the importance of promoting diversity in their work forces, not just because there is a law that demands this but because by doing so they achieve great competitive advantage.
An inclusive company that is open to differences and that correctly manages diversity will have the capacity to see beyond its prejudices and be able to recruit the best candidates. Having a diversified workforce will also contribute to innovation and facilitate adaptation to change.
In addition, a company’s social performance goes beyond complying with certain short-term economic goals. Being socially responsible is much more than just assigning part of the annual budget to social actions or sponsorship. It involves integrating into the company DNA those principles that imply both social and economic development. For example, in terms of diversity, it is the capacity of a company to take into account the human factor when pursuing its economic goals.
Since the legislator didn’t take full advantage of the opportunity in drafting this European norm, let’s trust in the initiative and responsibility of the companies in moving toward an inclusive society where we can all be equal in our diversity.