In France, most business organisations are incorporated in the form of companies with distinct legal personality.

French law distinguishes between civil companies, governed by civil laws exclusively, and commercial companies, governed by civil and commercial laws. Civil companies may operate only a limited list of activities, which are deemed civil by nature (eg, agriculture, liberal activities, real estate), while commercial companies may operate any type of activities, including civil activities.

There are three main differences between civil companies and commercial companies:

• civil companies may not conduct commercial or industrial activities – their purpose is therefore limited;
• shareholders’ liability is never limited in civil companies, whereas it is limited in most commercial companies; and
• most civil companies are tax-transparent – ie, profits of the company are taxed at the shareholders’ level and subject to income tax, whereas most commercial companies are subject to corporate tax.

These differences explain why civil companies are far less common than commercial companies, and are limited to specific uses. For this reason, they will be excluded from this study.

The corporate forms applicable to commercial companies are numerous and can be classified into two categories: limited liability companies and unlimited liability companies. Unlimited liability companies are rare and are used for extremely specific transactions, so they will also be excluded from this study.

Among limited liability companies, the most common corporate forms are:

• the public limited company (société anonyme or SA) is used for large companies, with most listed companies being incorporated in the form of SA;
• the simplified joint stock company (société par actions simplifiée or SAS) is a rather new corporate form but is largely used thanks to its high flexibility; and
• the limited liability partnership (société à responsabilité limitée or SARL) is primarily used for small businesses, as shares of SARLs are not freely tradable.

Corporate governance requirements are derived from laws and regulations, recommendations and internal rules set forth by companies themselves.

Laws and Regulations

The French Commercial Code (Code de commerce) and, to a lesser extent, the French Monetary and Financial Code (Code monétaire et financier) contain the majority of corporate governance rules and requirements.

European Union directives and regulations, such as the Shareholder Rights Directive II of 17 May 2017, or the Directive on improving the gender balance among directors of listed companies dated 23 November 2022, also set corporate governance requirements applicable to French companies. Requirements issued from EU directives shall be incorporated into French law in order to be enforceable, whereas requirements issued from EU regulations are directly applicable to French companies.

Recommendations

Listed companies are subject to additional recommendations issued by corporate governance codes to which they must refer (or explain why they decided not to), such as the AFEP-MEDEF Code, intended for large, listed companies, and the Middlenext Code, intended for small and medium-sized listed companies.

Such companies must also take into consideration recommendations issued by the Haut Comité au Gouvernement d’Entreprise (HCGE – a special committee appointed to follow the implementation of the AFEP-MEDEF Code and interpret its recommendations), the French Financial Markets Authority (AMF) and the Haut Comité Juridique de la Place financière de Paris (HCJP). In this respect, the AMF prepares a report on corporate governance and executive remuneration each year, based on the information disclosed by the issuers whose registered offices are in France. This report is highly anticipated as it may include any recommendations the AMF deems appropriate. Listed companies may also take into account the voting policies issued by proxy advisers, as they are followed by a majority of investors and give guidance on satisfactory governance policies for investors.

Internal Rules

Finally, companies may adopt internal rules, such as by-laws, board internal regulations, codes of ethics or codes of conduct that set forth specific corporate governance rules and requirements.

Specific Rules

In addition, certain sectors are subject to specific governance requirements that supplement the general framework described above. In the banking sector, for example, credit institutions, finance companies and investment firms are subject to enhanced governance rules.

Listed companies are subject to additional mandatory corporate governance requirements and recommendations.

First, only three corporate forms are authorised to trade their shares on a regulated market:

• SA;
• Societas Europaea (SE); and
• partnership limited by shares (société en commandite par actions or SCA).

Listed companies are subject to other mandatory corporate governance requirements.

• Composition of the board of directors (conseil d’administration) – the composition of listed companies’ boards of directors (or supervisory boards) is highly regulated. Listed companies are subject to gender balance requirements (the proportion of directors of each gender must be at least 40%) and requirements related to the appointment of directors representing employees and employee shareholders.
• Audit committee – listed companies are required to set up an audit committee, whose purpose is to provide technical and critical support to management in monitoring the company’s accounting and financial policy.
• Compensation of corporate officers (“say-on-pay”) – listed companies must comply with the “say-on-pay” requirements for the determination and payment of corporate officers’ and directors’ compensation. The “say-on-pay” proceedings require double shareholders’ approval on compensation: the shareholders shall vote on the compensation policy determined by the board of directors (ex-ante vote) and on the amounts payable to corporate officers and directors upon implementation of the approved compensation policy (ex-post vote).
• Enhanced governance information – listed companies must include additional corporate governance and ESG information in their management reports, as well as all relevant information on factors that are likely to have an impact in the event of a tender offer. Listed companies must also publish relevant information regarding related-party agreements.

Listed companies are also subject to various recommendations, including:

• the appointment of independent directors;
• setting up specialised committees; and
• limiting allowances granted to directors and/or officers – listed companies shall subject these allowances to performance criteria and limit their overall amount.

Recommendations applicable to listed companies mostly derive from corporate governance codes. Although these codes are deemed to be non-binding (soft law), listed companies choosing not to follow their recommendations must publicly explain why and justify their choice to the market (comply-or-explain principle). In addition, companies choosing not to follow recommendations issued by the AMF may be named in the AMF corporate governance report for not complying with its recommendation.

Recent legislative developments have also reinforced the supervisory role of the AMF regarding board composition. For companies listed on a regulated market that exceed the thresholds set by the “Women on Boards” Directive, as of 30 June 2026, the AMF will receive annual information from the relevant companies on the representation of women and men on their boards of directors and supervisory boards. On the basis of this information, the AMF will publish, and regularly update, a list of companies that comply with the provisions of the Commercial Code relating to gender balance on boards.

No recent changes to listing requirements on Euronext Paris have specifically affected corporate governance. However, recent developments have occurred regarding multiple voting rights, notably with the Attractivité Act of June 2024 and its implementing Decree of 11 December 2025.

French corporate law has long abandoned the rule of “1 share = 1 vote” by allowing the issuance of shares with multiple voting rights. However, their use was restricted for listed companies until the Attractivité Act of June 2024. In line with the EU Listing Act, the French legislature has allowed the issuance of multiple voting rights through preferred shares during the initial public offering of a company on a French regulated market or multilateral trading facility, notably to enable founders of high-growth companies to raise capital while limiting dilution in a competitive financial environment.

This law has established mandatory safeguards (which may be supplemented by the by-laws), including voting ratio caps, neutralisation of multiple voting rights for certain resolutions (with a specific framework applicable in the context of public takeover bids), and conversion into ordinary shares upon the occurrence of specific events.

The Decree of 11 December 2025 has further specified the conditions for the renewal of multiple voting rights shares by requiring a special report from the statutory auditors, detailing the number and initial duration of the shares as well as their impact on the company’s governance, including whether their existence influenced shareholder voting outcomes. The Decree also reinforces transparency by requiring pre-meeting disclosure of key information on multiple voting rights shares (including beneficiaries, duration and voting rights per resolution) and, where applicable, publication of the statutory auditors’ renewal report, at least 21 days prior to the shareholders’ meeting.

There are three main functions involved in the governance and management of French companies:

• deliberative functions;
• supervisory functions; and
• management functions.

Deliberative Functions

Deliberative functions are always delegated to the shareholders of the company. Depending on the corporate form, shareholders’ decisions are mandatorily adopted in general meetings (eg, SA) or may result, if the company’s by-laws allow it, from their unanimous consent expressed in a written act (eg, SAS, SARL).

Supervisory Functions

In elaborate forms of companies, specific bodies are responsible for supervising management, whereas management control is left to the shareholders in other forms of companies.

In SAs with a one-tier board system, the board of directors is a hybrid corporate body as it is in charge of supervisory functions over corporate officers, as well as certain management functions (please see below). In SAs with a two-tier board system, most supervisory functions are assigned to the supervisory board.

In other corporate forms (SAS, SARL), supervisory functions are performed, in a more limited way, directly by the shareholders, and no dedicated corporate body is provided by law. However, the shareholders may decide, in an SAS, to create specific corporate bodies and entrust them with supervisory powers.

Management Functions

Management functions include the definition and implementation of the company’s strategy and the representation of the company towards third parties. Depending on the corporate form of the company, management functions are exercised by individuals or collegiate bodies.

SAs may be structured pursuant to a one-tier board or a two-tier board system, at the shareholders’ discretion. This choice must be registered in the by-laws.

In an SA with a one-tier board system, the management functions are split between the board of directors (whose members are appointed by the shareholders), the chair of the board of directors (appointed by the board from among the directors) and the CEO (directeur général, also appointed by the board of directors). The board of directors may also decide to name a single person to act as chair and CEO (président-directeur général). The board of directors, upon request of the CEO, may appoint one or more deputy CEOs to assist the CEO and delegate management powers to them.

In an SA with a two-tier board system, the management functions are entrusted to the executive board (directoire), appointed by the supervisory board. Members of the executive board are not allowed to be part of the supervisory board. While the executive board traditionally operates as a collegial body, French law now allows greater flexibility for smaller companies: pursuant to Article L.225-58 of the French Commercial Code, as specified by a decree of 13 August 2025, the functions of the executive board may be exercised by a single individual in companies whose share capital is below EUR250,000.

In an SAS, the law entrusts the chair (président) with all management functions. The chair may be a natural or a legal person. The shareholders are free to provide additional corporate bodies in the by-laws, entrusted with limited management functions.

SARLs are managed by one or more managing directors (gérants), who are natural persons.

The powers and types of decisions made by the corporate bodies differ depending on the corporate form of the company.

SA

In one-tier board systems, the board of directors is competent to determine the strategic orientations of the company’s business and ensure their implementation within the limits of the company’s interest, taking social and environmental issues into consideration (please refer to 7.1 ESG Requirements). In particular, the board of directors:

• appoints the chair and the CEO, and defines their compensation schemes;
• examines and approves the annual financial statements;
• drafts management reports for the shareholders;
• convenes the general meeting of shareholders and sets forth its agenda; and
• approves related-party agreements.

The powers of the board of directors shall be exercised within the limits of the corporate scope of the company and the power granted by law to the general meeting of shareholders.

The CEO and the deputy CEOs, if any, are in charge of the day-to-day management of the company, within the limits of the corporate object of the company and the powers of the board of directors and the general meeting. Vis-à-vis third parties, the CEO has the broadest powers to represent the company and act on its behalf, even those exceeding the corporate scope and the limitations of powers that may result from the by-laws. However, those limits may only be enforced towards third parties if it is proven that they had knowledge of such limitations.

The board secretary role is not defined by law or governance codes, but has become essential in ensuring the effective implementation of governance standards, particularly in listed companies. The secretary supports the proper functioning of the board by organising its work, preparing agendas, issuing notices and drafting minutes. The role also includes overseeing compliance, co-ordinating with committees and internal functions, and assisting with general meetings. To ensure independence and efficiency, the secretary typically reports to the chair and must be provided with adequate resources.

In two-tier board systems, the supervisory board is responsible for the supervision of the management and the preservation of the company’s long-term interest. Therefore, the supervisory board:

• appoints the members of the management board and defines their compensation schemes;
• controls the annual financial statements;
• reviews the management reports; and
• approves related-party agreements.

Unlike the board of directors, the supervisory board is not entitled to make management decisions.

The executive board is in charge of the strategy of the company and its day-to-day management, within the limits of the general meeting’s powers. The chair of the executive board has the broadest powers to represent the company towards third parties.

SAS

The chair of the SAS is the only mandatory management body of the company, and is therefore entrusted with the broadest powers to manage the company within the limits of the shareholders’ powers and represent it towards third parties.

The shareholders may set up other corporate bodies to assist or supervise the chair. Internally, the chair’s powers shall be limited by specific powers granted to these corporate bodies. The shareholders may also decide to limit the chair’s powers in the by-laws and require prior authorisation from the shareholders for material decisions. Those limits may, however, be enforced towards third parties only if it is proven that they had knowledge of such limitations.

SARL

In a SARL, each of the managing directors has the broadest powers to manage the company within the limits of the corporate scope and shareholders’ powers. The same rules regarding third parties apply to the managing directors.

The applicable decision-making process depends on the nature of the corporate body.

Collegiate management and/or supervisory bodies meet periodically on a pre-defined agenda. Meetings are called by the chair, and the convening process is freely determined in the by-laws or other internal rules, if any. For the adoption of defined decisions, such as the approval of annual or interim accounts, the statutory auditors (if any) must be given notice of the meeting. As part of this decision-making process, board members must be provided with all information necessary to enable them to make an informed decision, sufficiently in advance; overly late or insufficient communication of supporting documentation may constitute a breach of the duty to inform, and may affect the validity of the relevant board resolutions.

In companies with at least 50 employees, the social and economic committee (comité social et économique) may attend the meetings in an advisory capacity, and must be informed and consulted on any significant structural change (including mergers, disposals, material changes to production structures, or the acquisition or disposal of subsidiaries) and its environmental consequences.

In SAs, the board of directors may also implement specialised committees whose role is to issue opinions on matters submitted by the board and falling into their competence area. In this case, the board of directors will be convened after the relevant committee and will make decisions based on the committee’s opinion.

Decisions of these bodies are made by a vote of the general meeting, which may be held physically, via videoconference, or by postal vote. In this regard, the majority and quorum rules are defined by law or the internal documentation of the company. By exception, and if so provided for in the by-laws, decisions may result from the unanimous consent of the shareholders, expressed in a written act. Decisions are registered in minutes – drafted by an external secretary or by a member of the corporate body – executed by the chair of the meeting and usually at least one other member of the body.

Recent reforms introduced by the Attractivité Act and its implementing decree have further modernised corporate governance practices by facilitating remote decision-making. Subject to authorisation in the by-laws, shareholder meetings (excluding those of listed companies and the annual ordinary shareholder meeting convened to approve the financial statements in a SARL) and board meetings may now be held entirely via telecommunication. In any case, shareholders of SAs and SCAs may attend physically held meetings by such means. By-laws may also allow written consultation (which may be conducted electronically), and postal voting for shareholders and board decisions (provided no board member objects).

French law does not dictate any decision-making process for non-collegiate corporate bodies, although it is recommended that material management decisions are registered in writing. In addition, the by-laws or other internal rules may enforce voluntary decision-making processes.

SA

As mentioned in 2.1 Principal Bodies and Functions, SAs may be structured pursuant to a one-tier board or a two-tier board system. Given the relative scarcity of the two-tier board system, this section (3. Directors and Officers) will only deal with the one-tier board SA.

SA boards of directors are composed of three to 18 directors, including the chair of the board. The shareholders appoint the directors, who may be natural or legal persons. In the latter case, they must appoint a permanent representative to the board. For further details regarding board composition, please refer to 3.3 Board Composition.

The board of directors may set up specialised committees (audit committee, compensation committee, ESG committee, etc), whose role is to issue opinions on matters submitted by the board in order to improve the effectiveness of the board. Specialised committees have consultative powers only and are not a substitute for the board. Audit committees are mandatory for companies whose shares are admitted to trading on a regulated market.

The shareholders may also appoint observers (censeurs) to the board of directors, with an advisory role only.

SAS

In an SAS, the structure of the board – if the shareholders decided to voluntarily set up such collegiate body – is freely set in the by-laws or internal rules adopted by the shareholders, if any.

SARL

There is no board of directors in a SARL, as the management is exclusively performed by its manager(s).

The board of directors is a collegiate body. As a principle, the directors collectively exercise the functions assigned to the board and do not have any individual powers, except for the chair of the board. However, the board of directors may grant specific assignments to individual directors, in order to improve the corporate governance of the company and facilitate the board’s mission.

Directors may be assigned to one or more specialised committees to help assess specific matters, given their skills and experience (please refer to 3.1 Board Structure).

The board of directors may appoint a lead director chosen from among the independent directors, to play a mediating role between the board of directors and the shareholders and improve shareholder dialogue. This function may, however, be entrusted to the chair of the board, particularly where the roles of chair and CEO are separated, or to a lead director with relevant experience in institutional communication. Lead directors are strongly recommended by the AFEP-MEDEF Code in a controlled listed company.

The chair of the board has a distinct role: it is in charge of organising and directing the work of the board of directors and reporting to the general meeting. The chair ensures the proper functioning of the company’s bodies and that the directors are able to fulfil their duties.

Various regulations and recommendations apply to the selection of directors and the composition of the board.

• Number of directors – the board of directors shall be composed of at least three and at most 18 directors, including the chair. Within these limits, the number of directors is determined by the by-laws.
• Natural or legal person – directors may be natural or legal persons, except for the chair, who must be a natural person.
• Share ownership – it is not mandatory for directors to hold shares of the company, but the by-laws may provide otherwise.

• Diversity – boards of directors of companies having more than 250 employees shall comprise at least 40% for each gender. This requirement is assessed by taking account of directors representing employees and employees-shareholders, where applicable. If the board is composed of eight or fewer directors, the difference between the representatives of each gender shall not exceed two.
• Age limit – in accordance with the French Commercial Code, not more than a third of the directors may be aged over 70, but the by-laws may provide for a stricter age limit.
• Multiple directorships – directors may not hold more than five directorships in public limited companies, it being understood that directorships in affiliated companies are excluded for the calculation of the directorships.
• Representation of employees – in large companies, employees are entitled to appoint directors representing the employees to the board of directors.
• Representation of employee shareholders – in large companies where more than 3% of the share capital is held by employees, the shareholders shall appoint directors representing the employee shareholders.
• Independence – corporate governance codes recommend that, in listed companies, a sizable proportion of directors should be independent (please refer to 3.5 Independence of Directors).

SA

Directors are appointed and may be dismissed at any time, without cause (ad nutum), by the general meeting of shareholders. Given that the agenda of the general meeting is set by the board of directors, shareholders are allowed to vote on the appointment and dismissal of one or more directors even if these decisions were not registered in the agenda. When a seat at the board of directors becomes vacant, the board is entitled to provisionally appoint a new director to fill the vacancy, subject to ratification by the next general meeting.

The chair of the board is appointed by and from among the directors of the board and must be a natural person, whether they assume the CEO position or not. The chair may be dismissed at any time, without cause by the board of directors.

If the chair does not assume the CEO position, the CEO is appointed by the board of directors. Deputy CEOs may also be appointed by the board of directors upon proposal from the CEO. The CEO and deputy CEOs must be natural persons, and may be dismissed at any time by the board of directors, but may claim damages if dismissed without cause (juste motif).

The appointment of directors must also comply with the legal requirements outlined in 3.3 Board Composition.

SAS

The chair is appointed and dismissed in accordance with the by-laws or internal rules of the company. If the by-laws do not provide any details regarding the conditions of dismissal, the chair may be dismissed at any time, without cause.

SARL

The managing directors of a SARL are appointed and dismissed by the general meeting of shareholders at any time, but may claim damages in the absence of cause. They can also be dismissed by the courts for legitimate cause, at the request of any shareholder.

There are no requirements concerning the independence of directors in non-listed companies.

With respect to listed companies on a regulated market, the French Commercial Code indirectly requires the appointment of independent directors, since the audit committee must include at least one director deemed independent, according to criteria specified and made public by the board of directors.

In addition, the corporate governance codes recommend that a sizeable proportion of directors be independent; the AFEP-MEDEF Code recommends that 50% of directors be independent in non-controlled companies, and 33% in controlled companies.

The corporate governance codes set out criteria for the assessment of the independence of directors. The board of directors shall use those criteria to determine which directors are independent, it being understood that the board remains free to deem a director independent if it is otherwise justified even if all criteria are not met. In practice, the interpretation of director independence criteria continues to evolve. The HCGE plays a key role in shaping market practice, through its annual reports and updates to its application guide of the AFEP-MEDEF Code. Its December 2025 update further clarified the assessment of independence, particularly in the context of parent companies.

Beyond its interpretive role, the HCGE may also be approached, at the initiative of the board or its members, as a consultative authority on specific governance matters – illustrating how corporate governance mechanisms can be weaponised in the context of hostile transactions. While the HCGE’s opinions are not legally binding, they carry sufficient practical authority to directly influence board composition in contentious situations.

Corporate officers and directors must act in accordance with the best corporate interest of the company, with the additional requirement provided by the Pacte Act enacted in 2019 to “take into consideration” social and environmental issues when making their decisions. This requirement reflects a broader evolution, both in French law and in comparative corporate governance, towards an expanded conception of corporate interest that is not limited to shareholders, but extends to stakeholders such as employees, suppliers and clients.

The scope of directors’ duties also expanded with the publication of the Corporate Sustainability Due Diligence Directive on 5 July 2024, requiring companies to mitigate their negative impact on human rights and the environment, including at the procurement, production and distribution levels, even though France has had a similar framework since 2017.

Directors and officers must act in accordance with the best interest of the company, which generally overlaps with that of the shareholders, but it is not systematic. In this respect, directors and the board are becoming increasingly pivotal in the implementation of new ethics standards in corporate strategy, with new or renewed interests to be taken into consideration (employees, other stakeholders, etc) when assessing the situation vis-à-vis the corporate interest of the company they manage.

According to the circumstances, a breach of directors’ or officers’ duties may be enforced by the following parties:

• the company, by an ut universi action brought through its legal representative – the action can also be brought by a shareholder when the company is held liable for breaches committed by its legal representative, in which case it would be an ut singuli action;
• the shareholders can enforce, for themselves, a breach of directors’ duties if they suffered a distinct harm from the company; and
• third parties can also hold a director personally liable in case of a fault separate from their functions, which fault is defined by case law as:
1. particularly serious;
2. intentionally committed; and
3. incompatible with the normal exercise of corporate functions.

It is important to point out that unless one of the directors is solely responsible, directors’ liability is collective, and may be joint and several, given the collegial nature of the board. Lastly, the recognition of directors’ liability under French law is not that common.

In France, directors and officers can be held liable for criminal and civil charges.

They would be liable for any criminal infringement such as misappropriation of corporate assets, distribution of fictitious dividends or publication of inaccurate annual accounts.

Directors and officers can also be civilly liable if they commit breach of laws and regulations applicable to the company (breach of the by-laws or other internal regulations). In addition, mismanagement by directors and officers can be a liability cause if they act contrary to the corporate interest of the company. Mismanagement ranges from negligence to fraud.

Directors and officers can also face administrative and tax liability; for example, in a case where they infringe the AMF securities law-related regulations, the authority is able to impose financial sanctions. As regards tax matters, however, the liability of officers is more limited and may only arise in cases of serious and repeated breaches of tax obligations or fraudulent conduct, attributable to them, which have made it impossible for the tax authorities to recover the company’s liabilities, potentially resulting in joint and several liability for such debts.

Their liability cannot be restricted or limited on a contractual basis. However, it can be excluded if the directors and officers demonstrate that they acted with a legitimate lack of awareness of a wrongful act, or if they show they were in opposition to the decision at stake.

Usually, the company offers insurance to the directors and officers, covering specific defence and investigation costs or damages.

Approvals and Restrictions Concerning Payments to Directors/Officers

SA

In an SA, the approval process for directors’ and officers’ compensation differs depending on whether or not the company is listed.

In non-listed SAs, the general meeting of shareholders must approve the aggregate amount of the compensation to be paid to the board of directors, as a whole. The allocation of this amount between the directors is then decided by the board of directors itself. The board also has exclusive authority to set forth the CEO’s compensation scheme and authorise any payment made to it, without any prior approval required from the shareholders.

CEO compensation schemes generally include a fixed and a variable portion, with the latter being paid upon the achievement of targets set by the board.

A listed SA must comply with the say-on-pay procedure. Under this regulation, the directors’ and officers’ compensation schemes are subject to a double approval process from the shareholders.

• The shareholders’ general meeting shall approve the compensation policy for the upcoming fiscal year, setting forth the principle and structure of the relevant compensation schemes (ex-ante vote). Any amount paid – or payable – to the directors and/or officers in violation of the approved compensation policy must be void.
• Each year, the shareholders’ general meeting shall approve all payments made to directors and officers or amounts owed to them pursuant to the pre-approved compensation policy (ex-post vote). Payment of variable and extraordinary compensation elements shall be subject to the approval of the ex-post vote.

A rejection of the ex-ante vote or the ex-post vote by the shareholders entails severe consequences:

• if the compensation policy is rejected, the previously approved principles and criteria shall continue to apply or, in the absence of any previously approved policy, the compensation scheme shall be determined in accordance with the compensation attributed for the previous financial year or, if none, in accordance with existing practice within the company; and
• if the compensation paid – or payable – to the directors and/or officers is rejected, the relevant officer shall be deprived of any variable and exceptional compensation due for the relevant fiscal year.

Compensation schemes for officers of listed companies are also subject to various rules and recommendations, including corporate governance codes (with, for instance, increasing recommendation to consider ESG criteria for variable compensation).

SAS

In an SAS, the conditions for the compensation of the chair and members of the board (if any) are set in the by-laws.

SARL

The compensation of the managing directors of a SARL is approved by the shareholders.

Disclosure of Payments to Directors/Officers

Listed companies must disclose any such compensation in a complete and transparent manner in their Universal Registration Document. This disclosure must provide the total compensation – fixed, variable and exceptional – and benefits of any kind attributed or paid to all corporate officers in the last year.

The company and its shareholders are legally bound by the by-laws, which constitute the company’s main internal regulation. As far as shareholders are concerned, this set of rules – mainly driven by applicable laws of the French Commercial Code – states their specific rights within the company, such as their right to vote, their right to receive dividends or their right to information about business and management matters.

In an SAS, the by-laws are even more significant since the relationship between the company and its shareholders mainly relies on them, as the SAS corporate form is little regulated by law provisions.

Public disclosure of shareholder information varies depending on the type of company. While SARLs are required to disclose shareholder allocations in their by-laws, which can be accessed through public platforms, sociétés par actions – such as SAS and SA – do not have a public register of shareholders. Instead, share ownership is recorded internally in share transfer registries maintained by the company. However, the situation differs significantly for listed companies. Shareholders exceeding certain thresholds must disclose their holdings to both the company and the AMF, which then makes this information publicly available.

Shareholders’ Involvement

As a general principle, shareholders are not meant to be in charge of the day-to-day management of the company, which is delegated to the corporate officers. Nonetheless, shareholders are entitled to have an important role in the making of certain decisions – ie, all matters attributed to the general meeting by law and the by-laws., such as the approval of the annual accounts, the appointment and removal of corporate officers and statutory auditors, the amendment of the by-laws or the dissolution of the company.

French law now provides a reinforced procedural remedy for shareholders who seek to challenge the agenda of the general meetings. Shareholders whose request to add an item or draft resolution to the agenda of a general meeting is refused may now bring an expedited claim before the Commercial Court (procédure accélérée au fond), thanks to the Attractivité Act. This mechanism strengthens minority shareholders’ rights by enabling a ruling on the merits within a timeframe compatible with the holding of the disputed meeting.

Besides this “typical” involvement, shareholders now play a more important role as they are increasingly solicited on the management of the company’s activity and administration. For example, shareholders are now consulted on the remuneration of executives (say-on-pay), and can also be consulted on the company’s action and influence on climate issues (say-on-climate).

No Interference in the Exercise of Executive Functions

Shareholders are not meant to have a direct role in the everyday management of the company, which is reserved to the executive officers, who have broad powers to represent the company towards third parties. However, shareholders do enjoy some important prerogatives, such as information rights and the ability to ask questions, request the inclusion of draft resolutions on the agenda, or participate in collective decisions, which allow them to influence corporate affairs without encroaching on management powers. Sustained and intrusive involvement in management decisions may nonetheless lead courts to qualify a shareholder as a de facto officer (dirigeant de fait), accountable like any legal officer (dirigeant de droit).

Ordinary General Meetings

At least once a year, within six months of the end of the financial year, an annual ordinary general meeting of shareholders must be convened in order to vote on the annual accounts and consolidated accounts, the distribution of dividends and, in listed companies, the compensation of the board members and the executive officers (please refer to 1.3 Companies With Publicly Traded Shares).

Under the annual ordinary general meeting, shareholders usually also vote on the appointment or removal of board members, the appointment of the statutory auditors, the related-party transactions and any decision other than those reserved to the extraordinary general meeting of shareholders.

Extraordinary General Meetings (EGM)

The EGM is competent to approve amendments to the company’s by-laws, any changes to the share capital, mergers and spin-offs, and the early dissolution of the company.

Shareholders’ general meetings are convened by the board or any person designated in the by-laws to do so. Notice for holding meetings must be given at least 15 days in advance in SAs and SARLs. However, listed companies or companies whose shares are not all held in registered form are required to publish a notice of the meeting in the Bulletin of Mandatory Legal Announcements (Bulletin des annonces légales obligatoires), at least 35 days before the meeting. The notice of the meeting must contain certain mandatory information, such as the agenda of the general meeting (for SARLs and SAs whose shares are listed on a regulated market – please refer to 4.2 Role of Shareholders for further developments in connection with shareholders’ involvement in the agenda-setting process).

Recent regulatory developments introduced by Decree No 2026-94 of 13 February 2026 have significantly modernised the framework governing shareholder meetings, particularly through increased digitalisation and procedural adjustments, including (subject to applicable conditions) streamlined dispatch of convening documents, removal of the obligation to physically send documents made available online and a “record date” (mechanism used to determine shareholders entitled to participate and vote in general meetings) set at five business days prior to the meeting (instead of two), at midnight Paris time, for both listed and non-listed companies.

Overall, these reforms reflect a shift towards more efficient and dematerialised shareholder meeting procedures.

The quorums and majorities required for the validity of meetings vary depending on the ordinary or extraordinary nature of the decision submitted to the shareholders, the corporate form of the company and the provisions of the by-laws. In an SA, for instance, adopting an ordinary decision requires a quorum of at least one-fifth of the voting shares on first convocation, no quorum on second convocation, and a simple majority of the voting shares of the shareholders present or represented. The adoption of extraordinary decisions requires a quorum of at least a quarter of the voting shares on first convocation, one-fifth on second convocation, and a two-thirds majority of the voting shares of the shareholders present or represented.

However, it should be noted that increasing the shareholders’ commitments towards the company requires a unanimous decision of all the shareholders.

In general, shareholder meetings are held physically at the registered office or any location specified in the notice of the meeting, but can also be held remotely or by written consultation if the by-laws provide for it. Under the Attractivité Act, shareholder meetings of companies listed on a regulated market are required to be broadcast live, unless technical difficulties prevent or severely disrupt such transmission. Furthermore, these companies must ensure that a recording of the meeting is made available for later consultation and, where applicable, disclose whether the recording encompasses the entire meeting.

Executive officers and/or directors who violate applicable laws and regulations or the by-laws, or are otherwise at fault in their management, are individually or jointly liable towards the company. In this case, one or more shareholders may bring a legal action against the executive officers and directors for damages suffered by the company (action ut singuli). The resulting damages will be paid to the company.

In addition, if the shareholders have suffered personal losses separate from those suffered by the company, executive officers and directors will also be liable to those shareholders (please refer to 3.9 Other Claims/Enforcement Against Directors/Officers).

Following the Transparency Directive providing for the harmonisation of transparency requirements across the European Union, French securities laws impose certain strict filing and disclosure requirements to which prospective shareholders in publicly traded companies should pay particular attention.

Such reporting obligations fall primarily within the mandatory disclosure of major shareholdings. The French Commercial Code thus requires the disclosure within four trading days to the issuer and to the AMF of any holding of shares or voting rights of a company admitted to trading on a regulated market when the percentage of such shares or voting rights reaches, exceeds or falls below the following thresholds (whether through open market purchases, negotiated transactions or otherwise): 5%, 10%, 15%, 20%, 25%, 30%, one-third, 50%, two-thirds, 90% or 95%. The AMF then publishes this information. Issuers’ by-laws may also impose additional disclosure requirements – even below the 5% statutory threshold – for thresholds of not less than 0.5%.

Upon crossing the thresholds of 10%, 15%, 20% and 25% of the capital or voting rights of a company admitted to trading on a regulated market, the relevant shareholder must also inform the company and the AMF, within five trading days, of its objectives for the following six-month period in a statement of intent (déclaration d’intention). In the event of a change in intent within the six-month period following the statement of intent that was originally filed, a new statement must be issued promptly to the company and the AMF, and made public under the same conditions. The six-month period is reset with this new statement.

Legal Reporting

Companies are required to file various documents relating to their accounts for the previous financial year with the registrar of the commercial court. This filing must be made within one month of the approval of the annual accounts by the annual ordinary general meeting, or two months if the filing is made by electronic means.

The filing covers the following documents:

• the annual accounts;
• the management report, in the case of a listed company – for all other companies, the management report does not have to be filed but a copy must be made available, at the company’s registered office, to any person upon request;
• the auditors’ report on the annual accounts;
• the proposal for the allocation of profits submitted to the annual general meeting and the relevant resolution on the allocation adopted by the annual general meeting; and
• the consolidated accounts, the group management report and the auditors’ report on the consolidated accounts, in the case of a company required to prepare such accounts.

Specific Complementary Filings for Listed Companies

Listed companies are also required to publish and file with the AMF:

• an annual financial report within four months of the end of the financial year; and
• a half-year financial report within three months of the end of the first half of the financial year.

In addition, listed companies have the option of publishing quarterly or interim financial information at their discretion. If they choose to publish such financial information, the AMF recommends that the publication be presented with a commentary designed to clarify the relevant financial information and thus enable investors to better understand the company’s situation.

Corporate Governance Report

SAs and SCAs are required to draw up a report on their corporate governance, which is attached to the management report. For listed companies, this report is usually incorporated in the Universal Registration Document.

Corporate Governance Codes

The corporate governance report of listed companies is required to specify, among other things, the corporate governance code applied by the company. In France, the AFEP-MEDEF Code is commonly used by listed companies, with 97 companies of the SBF 120, including 35 of the CAC 40, having designated it as their reference code as of 1 March 2025; it is generally regarded as the most sophisticated corporate governance framework in this area. If the company chooses not to comply with a specific provision of the corporate governance code, it must explain how it departs from it and why, in accordance with the comply-or-explain principle (please refer to 1.3 Companies With Publicly Traded Shares). Companies can also choose to refer to the corporate governance code drawn up by Middlenext, which is intended for medium-sized companies listed in Paris.

In France, companies are registered with the Registre du Commerce et des Sociétés (RCS) through the single window for business formalities (guichet unique des formalités d’entreprises), which submits the information to the competent commercial court clerk (greffier du tribunal de commerce). Any updates to the constitutive documents during the life of the company must be filed with the relevant companies’ registry. These updates and their related corporate documents are publicly available and include amendments to the by-laws, changes to executive officers and board composition, transfers of the registered office, and changes to the share capital and statutory auditors.

The financial reports mentioned in 5.1 Financial Reporting Requirements are also required to be filed with the companies’ registry. However, micro-enterprises and small companies, as defined in the French Commercial Code, may request confidentiality for their annual accounts from the registry. Following the increase in thresholds by a decree of 28 February 2024, more small businesses will be eligible for this option, reducing administrative burdens and protecting sensitive information.

The registry’s clerk has supervisory powers and conducts several checks to ensure compliance with regulations and the authenticity of supporting documents. If necessary, the clerk can reject filings or, in some cases, order the company’s removal from the registry.

In case of failure to comply with the filing obligations, companies – or their officers if the failure constitutes a fault separate to their functions – may be exposed to civil and criminal fines.

Under Regulation (EU) 2024/1624 and Article L. 561-15 of the French Monetary and Financial Code, obligated entities – including credit institutions, investment firms, insurers, crypto-asset service providers and certain non-financial professions (lawyers, notaries, chartered accountants) – must report to TRACFIN any sum or transaction suspected of deriving from an offence punishable by a custodial sentence of more than one year, or in connection with terrorism financing. They must also conduct KYC procedures and identify beneficial owners, with vigilance thresholds.

Obligated entities are required to implement internal control systems and staff training programmes. Supervision is conducted by the ACPR or AMF, depending on the sector, with the newly established Anti-Money Laundering Authority directly overseeing the 40 highest-risk groups from 2025 at this stage.

In the event of AML non-compliance, exposure can be significant. The ACPR may impose fines of up to EUR100 million or 10% of total annual turnover on the entity, and individual sanctions on directors, including temporary bans from management functions of up to ten years and personal financial penalties. The Commission nationale des sanctions may impose fines of up to EUR5 million on non-financial obliged entities. In the event of a breach, the competent authority may also impose sanctions on the directors’ entity and on other natural persons who are employees, agents or otherwise acting on its behalf, on account of their personal involvement.

The appointment of an external auditor by the shareholders’ ordinary general meeting becomes mandatory if, at the end of the financial year, the company exceeds at least two of the following thresholds (these thresholds have been modified by a decree of 28 February 2024, transposing a delegated Directive of 17 October 2023):

• a balance sheet total of EUR5 million;
• net turnover of EUR10 million; and
• 50 employees.

Auditors are subject to certain requirements regarding their independence, which prohibit them from having any personal, financial or professional relationships that are incompatible with the functions of an auditor. In addition, any commercial activity or paid employment of the auditor for the benefit of the company whose accounts they audit is prohibited, in order to preserve the auditor’s independence.

While no provision expressly mandates a governance framework dedicated to geopolitical risk, several legal frameworks converge towards an obligation of vigilance at the highest level of the company. Article L. 225-35 of the French Commercial Code entrusts the board of directors with defining the company’s strategic orientations and overseeing their implementation, which encompasses the management of major risks. In practice, boards of listed companies with significant international exposure are increasingly attentive to geopolitical considerations, and may call upon external advisers or specialist experts to inform their deliberations. Risk factors are typically assessed at the level of the audit committee before being escalated to the full board, which retains ultimate oversight responsibility.

The reach of foreign sanctions regimes – most notably those of the United States – represents a material exposure for French groups operating internationally. In the same vein, French groups operating across multiple jurisdictions remain attentive to the qualification of certain territories as tax havens, which carries its own regulatory and reputational consequences under both French and EU law.

Beyond sanctions, the broader geopolitical and environmental risk landscape may also give rise to stakeholder engagement at governance level. This is illustrated by the practice of say-on-climate resolutions (please refer to 7.2 ESG Developments).

ESG and Strategy

The board of directors is entrusted with the definition of the strategy of the company. In doing so, the board is legally bound to take social and environmental issues into account.

Corporate governance codes have increased their recommendations towards better consideration of climate and environment protection-related issues, with the recommendations to create an ESG committee in charge of investigating ESG matters, the enhanced training of directors or the increase of ESG performance criteria as part of executives’ compensation schemes.

Pressure to increase climate strategy reporting to shareholders is also in constant evolution.

Progressive Entry Into Force of the Rixain Act

Since March 2022, companies with at least 1,000 employees for three consecutive fiscal years have been required to publish data on gender inequalities among executive managers and governing bodies (such as an executive committee). As of March 2026, these companies must ensure at least 30% representation of each gender among executive managers and governing bodies, increasing to 40% by March 2029. A two-year grace period will be granted for compliance, after which financial penalties may apply.

Corporate Duty of Care

Since 2017, the largest French companies, as well as large foreign companies operating in France, including through subsidiaries, have been subject to due diligence obligations to identify any risks and prevent any violations of human rights and fundamental freedoms, or severe abuses of human health and safety and of the environment, resulting from their activities as well as those of their subsidiaries, suppliers and subcontractors. These companies must establish a vigilance plan and a report on its effective implementation, to be included in the annual report.

The EU Corporate Sustainability Due Diligence Directive (CSDDD), as substantially revised by Directive (EU) 2026/470 (the Omnibus Content Directive) of 24 February 2026, now applies to EU companies with more than 5,000 employees and EUR1.5 billion in net worldwide turnover, with application postponed to 26 July 2029 (transposition deadline: 26 July 2028). The revised framework adopts a simplified, risk-based approach based on a scoping exercise followed by targeted in-depth assessments, replacing exhaustive value chain mapping. Monitoring obligations are reduced to a five-year cycle, and information requests to business partners must be limited to what is necessary and reasonably available. Continuing a relationship with a high-risk partner does not in itself trigger sanctions where reasonable prospects of improvement exist. Administrative fines are capped at 3% of global turnover. Also, a harmonised EU civil liability regime has been abandoned, with liability now governed by national law. The notion of stakeholders has been narrowed to workers, their representatives, and individuals or communities directly affected by the company’s activities.

Extra-Financial Reporting and Corporate Sustainability Reporting Directive

French listed companies and other large companies are subject to extra-financial reporting obligations (in the form of a non-financial performance declaration), significantly extended by the Corporate Sustainability Reporting Directive (CSRD) of 14 December 2022, which introduces a comprehensive sustainability report based on a double materiality principle (covering both the impact of sustainability matters on the company and the company’s own impact on sustainability matters).

The sustainability report, to be included in the annual management report, must be certified by authorised auditors or independent third-party organisations, and shareholders holding at least 5% of the capital or voting rights may request the appointment of a separate certifier to draft a separate report on some or all of the sustainability information.

Following the “Stop the Clock” Directive of April 2025, the CSRD timetable has been adjusted, with reporting obligations applying in three successive waves:

• large listed companies with more than 500 employees (2025 financial year, published in 2026);
• other large companies and parent companies of large groups (2027 financial year, published in 2028); and
• listed SMEs excluding micro-enterprises (2028 financial year, published in 2029).

To guide companies, the ESMA, the European Commission and the Haute Autorité de l’Audit have respectively published recommendations, Q&A and guidelines.

The CSRD framework has been further amended by Directive (EU) 2026/470 of February 2026, which narrows the scope of application by raising the eligibility thresholds to companies with more than 1,000 employees and more than EUR450 million in net turnover, effectively excluding a significant number of undertakings and definitively removing listed SMEs from the regime. Several additional adjustments have also been introduced, including:

• a value chain cap limiting reporting requests on suppliers with fewer than 1,000 employees to the voluntary VSME standard;
• a significant streamlining of the ESRS framework (estimated 50–60% reduction in data requirements, removal of sector-specific standards);
• the abandonment of the move to reasonable assurance; and
• a right to omit information where disclosure would seriously harm commercial interests (including in relation to intellectual property, trade secrets or classified information).

Raison D'Être and Mission-Driven Companies

In 2019, the Pacte Act introduced two optional tools into French corporate law designed for companies intending to redirect their focus on their role in society, beyond their economic performance.

• The raison d’être (core purpose) allows a company to define the ethical standards and orientations according to which its activities will be conducted. It is incorporated into the by-laws, with its effectiveness depending on the precision with which it is drafted.
• The status of mission-driven company goes further, requiring the adoption – in addition to a raison d’être – of specific commitments towards environmental, ethical and/or social concerns, approved by the general meeting and included in the by-laws. Compliance is assessed regularly by a dedicated mission committee (comprising at least one employee), and failure to comply potentially entails both withdrawal of the status and liability claims against the directors and the company.

Green Shareholder Activism and “Say-on-Climate”

In recent years, shareholder activism has increasingly focused on ESG and climate-related issues. Since 2020, activist investors have increasingly requested issuers in high-impact sectors to submit their climate strategy to a shareholder vote; following initial resistance, most issuers have progressively incorporated advisory say-on-climate resolutions into their general meeting agendas, encouraged by the HCJP (December 2022) and the AMF (March 2023). A proposal to introduce a “say-on-climate” statutory regime including new obligations for listed companies with a view to improving their climate strategy was made as part of the discussions on the Green Industry Act in 2023, but was in the end rejected by the French legislature.

Sanctions Regarding Compliance With Corporate Duty of Care

Please refer to 7.1 ESG Requirements for developments regarding the Corporate Duty of Care framework.

Recent case law confirms a progressive judicial consolidation of the French duty of care regime as a standard of corporate liability.

In La Poste (Paris Court of Appeal, 17 June 2025), the court confirmed the non-compliance of the company’s vigilance plan due to methodological deficiencies, identifying in particular an overly general risk mapping, insufficient alignment of third-party assessment procedures with identified risks, an inadequately structured whistle-blowing mechanism, and a monitoring system insufficiently linked to risk prevention objectives. This decision provides detailed methodological requirements for the design and implementation of vigilance plans, reinforcing the central role of risk mapping as the foundation of the system.

In Laboratoires Yves Rocher (Paris Judicial Court, 12 March 2026), the court partially upheld claims brought by former employees of a Turkish subsidiary, a local trade union and NGOs, holding that French duty of care legislation qualifies as a loi de police applicable to damages occurring abroad, and finding the parent company at fault for excluding its foreign subsidiaries from its risk mapping and failing to implement adequate preventative measures against known risks of trade union repression. This marked the first instance in which a French company has been ordered to compensate harm arising from its activities abroad.

Together, these decisions illustrate that the duty of care is no longer limited to formal compliance obligations but is increasingly being interpreted as a substantive standard of corporate conduct, capable of giving rise to civil liability for failures in risk identification, prevention and monitoring across global value chains.

Under French law, oversight of artificial intelligence by the board of directors is not governed by any standalone legal regime but falls within the general framework of company law: the board is entrusted with defining the company’s strategic orientations and overseeing their implementation, which necessarily encompasses the governance of AI systems deployed within the company. AI is accordingly characterised as a technical decision-support tool, the use of which cannot entail any transfer of decision-making authority away from the board.

In practice, AI is increasingly becoming an explicit area of competence for boards of directors within listed companies. This development is reflected in the establishment of dedicated training programmes for board members, covering technological developments in AI. This integration is also reflected in executive remuneration frameworks, where specific targets related to digital transformation and artificial intelligence are taken into account in the determination of variable compensation. Companies are further developing internal governance mechanisms to oversee the deployment of AI technologies, the adoption of internal policies or charters governing the use of technologies such as generative AI. From a risk perspective, AI-related exposures are often addressed in universal registration documents. These include technological and operational risks linked to system failures, miscalibration or inappropriate use of AI models, which may generate erroneous outputs with financial consequences, as well as legal and regulatory risks, particularly those relating to personal data protection.

At the European level, Regulation (EU) 2024/1689 (the AI Act) establishes a risk-based regulatory framework applicable to providers and deployers of AI systems, imposing graduated obligations – notably for high-risk systems – without directly targeting corporate boards as such.

Please refer to 8.1 Board Oversight of AI.

Under French law, the use of artificial intelligence does not give rise to a specific liability regime for boards and corporate officers. Liability exposures instead arise from the application of existing legal frameworks, particularly company law, civil liability, criminal law and sector-specific regulations such as data protection law and Regulation (EU) 2024/1689 (GDPR). Enforcement may be initiated by multiple actors depending on the circumstances and the sector, including the company, shareholders, regulatory authorities such as the AMF and CNIL, and, where applicable, criminal prosecutors.

Under French law, there is currently no standalone general disclosure requirement specifically dedicated to the use of artificial intelligence. Disclosure obligations instead arise from existing legal frameworks – in particular company law, securities law and sustainability reporting – within which AI-related matters may need to be addressed where they are material.

In relation to annual reports, companies are required to describe their internal control and risk management procedures. While there is no obligation to refer specifically to artificial intelligence, AI-related risks may need to be disclosed where they are relevant to the company’s operations, compliance or financial reporting.

For listed companies, financial disclosure rules require information provided to the market to be accurate, precise and not misleading. In this context, the disclosure of AI-related matters could be driven by a materiality test: where the use of artificial intelligence is likely to have a significant impact on the company’s financial position, performance, risk profile or strategy, it should be disclosed to investors as part of the information necessary for them to make informed investment decisions. Recent 2025 universal registration documents nonetheless show a growing integration of AI within existing disclosure frameworks. While no standalone obligation exists, issuers increasingly address AI through governance disclosures (including board training and the integration of technological expertise), strategic discussions on its impact on business models and operations, and more detailed identification of related risks, particularly in terms of data quality, regulatory compliance and intellectual property.