The principles laid down in the directive are rather innovative in relation to the Italian legal system. While employee representation is well defined also with regard to information rights (for example, in laws 223 of 1991, 428 of 1990 and 626 of 1994), the concept of “participation” has hitherto been defined only in collective bargaining agreements or jointly established regulations. The most substantive change as regards the Italian system will be provisions regarding the composition of management or supervisory boards, in which the presence of employee representatives is envisaged.

Existing Italian company legislation excludes any form of employee participation in the governing body of a company. The administrative board, elected/appointed by the shareholders, mainly following internal regulations, governs the company. The correctness of financial management and company information must be guaranteed by a committee of auditors, whose sole aim is to audit the financial information of the company as a whole, and in the interest of the company as a whole. The auditors do not act on behalf of one group of shareholders (or stakeholders), but on behalf of their collectivity.

These legal provisions leave room for grey areas concerning corporate governance. Recently, the government has taken action to develop more stringent legislation and to fill these gaps and, at the same time, has come up with proposals concerning the introduction of employee participation rights.

Also because of the financial scandals involving major Italian companies, reform of company legislation has been accelerated, whereas the introduction of a “participatory” system is lagging behind.

According to the government, one reason for this “dual speed” approach is the difficulties experienced by the social partners in reaching a joint opinion on the matter. The government says it intends to respect the “Pact for development and employment of December 1998”, according to which it will follow the “joint opinions” of the social partners with regard to transposition of EU social directives, as was the case with the transposition of Directive 945/45 EC on European Works Councils. At present the social partners have not reached a joint opinion on Directive 2001/86 EC, so the government is proceeding with transposition of the SE regulation [1], while the SE directive remains “on hold”.

In February 2002 the government encouraged the social partners to begin negotiations, which should lead to transposition of the SE directive. The government specifically called for a “joint opinion” from the social partners which could be transposed into law, following the general agreement on social dialogue of December 1998.

The trade unions, whose approach in this matter has always been unified and proactive, after defining their joint position invited the employers’ organizations to open discussions on this matter. In February 2003, the industry confederation Confindustria accepted. This roundtable is presently engaged in discussions.

At the same time, the trade unions held informal talks with Confcommercio (the confederation of commerce, in particular wholesalers and retailers), ABI (the national association of banks) and ANIA (the national association of insurance companies) with the aim of setting up a roundtable leading to an interconfederal agreement (or “joint opinion”), signed by all the representative organisations of industry, trade and finance on one side and of employees on the other. Such an agreement could be validated by the government and consequently become a legally binding text for implementation of the directive. As described above, a similar approach was established in 1998 quite successfully and was followed for the implementation of the EWC directive. In that case, the parties reached a collective bargaining agreement which was legally binding on all its signatories as early as 1996 and was transposed into law in 2002, thus setting an example of a positive modus operandi.

However, in recent months, other issues have had priority on the government’s and the social partners’ agendas, and the general relationship between government, employers’ organisations and trade unions has deteriorated, so that little or no progress has been made.

In June 2004, during a seminar [2] organized by CESOS [3] and CISL on the subject of employee participation in the SE, the representatives of the three trade union confederations CGIL, CISL and UIL reiterated their desire to reach a joint opinion with the representative organizations of industry (Confindustria), banking (ABI), insurance (ANIA) and commerce (Confcommercio) by October 2004. This joint opinion will then be submitted to the government as a basis for the law transposing directive 2001/86 EC.

Thus the way towards transposition appears to be clear. [4] However, it appears that the social partners have different views and that there is still a long way to go before a joint opinion is reached. There appears to be unanimity on one point. On the question “what form of participation do we want?”, the representatives of the social partner organizations all agreed that they did not want a “German model”. The trade union confederations CGIL, CISL and UIL have already reached a joint position, and invited the employers’ organizations to present their proposals so that a fruitful debate can begin.

In consideration of the consensus among social partners and government that a law will be discussed following the definition of a joint opinion, debate in parliament on the transposition of Directive 2001/86 EC cannot be expected before November 2004. It is not on the agenda for the September session, when Parliament convenes after the traditional August holidays to debate, among other items, the “acquis communautaire”, which in general terms is the sum of all EU legislation to be transposed into Italian legislation.

Footnotes: [1] This is the government’s vision. The social partners take a different position according to which the government has so far failed to come up with a proposal which they could discuss with view to reaching a joint opinion.

[2] “La società europea, la partecipazione dei lavoratori e la governance delle imprese”, Rome, 14–15 June 2004.

[3] Centro di Studi Economici, Sociali e Sindacali, a research institute of CISL.

[4] While there has always been a consensus that the social partners should formulate a joint opinion as a basis for the transposition law, there have been different views on how such an opinion should be reached. See note 1.