Introduction
Companies are increasingly expected to contribute to the climate transition. Therefore, climate change policy has become a permanent fixture of corporate policy. One question, however, tends to receive far less attention than it deserves: what role can and should the works council play in corporate climate change policy?
In the Netherlands, the works council (ondernemingsraad) is the statutory body through which employee participation within a company is ensured. Under Article 28(4) of the Dutch Works Councils Act (Wet op de ondernemingsraden, WOR), the works council has a duty to promote, to the best of its ability, the company’s care for the environment. The literal wording of this provision is narrow: it speaks of ‘the environment’, not of ‘sustainability’ or ‘climate transition’. This raises questions. Does the works council’s task stop at recycling coffee cups, or does it extend to the broader ambitions that now dominate corporate sustainability agendas? And if so, how does the works council put its role into practice?
A broad duty rooted in regulatory development of corporate environmental responsibility
Article 28(4) WOR was introduced in 1998 with the purpose of bringing ‘company environmental care’ within the works council’s mandate. We take the view that, nowadays, this provision must be interpreted to cover not only the company’s care for the environment in a narrow sense, but also its broader climate-related efforts. This conclusion follows naturally from the way regulation of corporate environmental responsibility has developed since the late 1980s.
What began as a narrow notion of ‘company environmental care’, introduced in Dutch policy documents around 1989 to describe a company’s own efforts to limit its environmental footprint, has since been absorbed into a much broader regulatory architecture. The UN Guiding Principles on Business and Human Rights, OECD Guidelines for Multinational Enterprises and Dutch Corporate Governance Code now explicitly recognise corporate responsibility for climate and environment. And what was once only ‘soft law’ has hardened considerably: the EU’s Corporate Sustainability Reporting Directive (CSRD) and Corporate Sustainability Due Diligence Directive (CS3D) now impose binding obligations on companies to, amongst others, report on their plans to align business models and strategy with the objective of climate neutrality by 2050, and to consult employee representatives on precisely these matters. The so-called ‘Omnibus’ package has weakened the potential reach of both directives, but this should not be overstated: the companies falling within their scope are often major market players with significant influence. The indirect effect of the directives thus remains considerable.
Case law tells a similar story. Courts have held that companies bear responsibility for combating climate change. The Dutch Court of Appeal found in the Shell case that Shell bears its own responsibility for achieving international climate goals, while stopping short of imposing a specific reduction order. A German court recently went further still, allowing a Peruvian farmer’s tort claim against an energy company for cross-border climate harm linked to its emissions.
Taken together, these developments support a reading of Article 28(4) WOR that is not frozen in its 1998 vocabulary. If sustainability and climate action have become embedded in what it means for a company to function well, and Article 2(1) WOR already tasks the works council with promoting precisely that, then a narrow, literal reading of Article 28(4) WOR sits uneasily with the law’s own underlying purpose. Thus, promoting sustainability, in a broad sense, is and should be understood as part of the works council’s task.
From mandate to practice: who, what, and how
Recognising that works councils have a role to play is one thing. Knowing how to exercise it, is another. Many works councils might acknowledge the urgency of sustainability policy, only to see initiatives stall over practical questions: who takes the lead, what falls within scope, and how should the council actually proceed?
On the question of who, the works council can address sustainability as a full body, or it can establish a dedicated sustainability committee under Article 15 WOR. We see real advantages in the latter. A sustainability committee sharpens focus, and it can include colleagues from outside the works council itself, so long as at least one council member sits on it. This opens a route for staff with particular expertise or motivation on climate issues to contribute without first being elected to the council. To ensure the necessary expertise on what are sometimes highly technical climate-related topics, members of a works council committee are entitled to three additional training days per year, independently of their works council membership (Article 18(3) and (3) WOR). Moreover, the works council (or sustainability committee) may also invite an external expert to attend meetings (Article 16 WOR). The costs of doing so are borne by the employer, provided the invitation is reasonably necessary for the performance of the council’s task and the employer has been informed of the costs in advance (Article 22(1) and (2) WOR).
As for what, the works council can set its sights modestly (e.g., greener commuting policies, more sustainable office supplies) or it can engage with the company's underlying strategy. Given the breadth we attribute to the council’s statutory task, we encourage the latter, more strategic, approach.
That leaves how. The Works Councils Act gives the council several concrete instruments. It has a right to information under Article 31 WOR, enabling it to request environmental data the employer may not otherwise have compiled. It can convene meetings under Article 23 and 24 WOR, where sustainability ambitions can be discussed directly with the employer, a dialogue the Dutch Corporate Governance Code also encourages by requiring companies to engage stakeholders, including employee representation, when setting strategy on sustainability matters. The council also holds a right of initiative under Article 23(2) and (3) WOR, allowing it to put concrete proposals to the employer.
More powerful still is the advisory right under Article 25(1)(l) WOR, which applies to significant measures connected to the company’s environmental care, including policy-level decisions. Other advisory rights that may seem less immediately obvious can equally come into play in a sustainability context. Consider, for example, situations where a company intends to introduce a sustainable line of business (Article 25(1)(d) WOR) or plans to make a significant investment in greening its operations (Article 25(1)(h) and (k) WOR). Even the consent right under Article 27 WOR, which on its face has nothing to do with the environment, can become a lever: the works council can make its green contribution by consenting to decisions that the employer grounds in sustainability objectives. Conversely, a well-substantiated climate argument can tip the balance when an employer seeks a court’s permission to override the council’s refusal to consent to a to a decision that is harmful to the climate. Finally, the works council and the employer remain free to go beyond the statutory minimum altogether, recording binding sustainability commitments in a works council agreement under Article 32(2) WOR.
Conclusion
We believe the Works Councils Act provides sufficient instruments for works councils to play a meaningful role in the climate transition. We encourage works councils to take a strategic approach: not limiting themselves to small-scale initiatives, but engaging with environmental considerations across the company's broader decision-making processes. The tools are there. What remains is for works councils to use them with the ambition the moment demands.
This post is based on S. van Dijk, M.H. Hoving & K.N. van der Heijden, ‘De ondernemingsraad kleurt groen: wie, wat en hoe?’, Tijdschrift voor Arbeidsrecht in Context 2025(3), 150-160.