Social and Environmental Balanced Scoreboard

On December 6, 2007, the Legislature of the City of Buenos Aires approved Law No 2,594 (the “Law”) which provides for a Social and Environmental Balanced Scoreboard (“SEBS”).

The Law was automatically ratified on January 16, 2007 and it is currently awaiting regulation by the Executive Branch of the City of Buenos Aires (“CBA”) within 60 days of its ratification.

The Law aims to promote a social and environmentally responsible conduct by the firms having their core activities within the CBA.

It provides for the preparation and filing of the SEBS report, which shall be mandatory for any firm which:

        a.  has more than 300 workers;

        b.  has an annual turnover above the limits set by Undersecretariat for Small and Medium Sized Enterprises and Regional Development, as follows:

i)                     agriculture and farming: AR$ 18,240,000

ii)                   manufacturing and mining: AR$ 60,000,000

iii)                  retail: AR$ 88,800,000

iv)                  services: AR$ 22,440,000

v)                    construction AR$ 24,000,000

        c. is incorporated in the CBA;

        d. has its core activity based in CBA for at least one year prior to the enactment of this Law, whether the firm is Argentine or foreign.

This Law also allows any firm that may so wish to file the SEBS report optionally   in exchange for promotional benefits (e.g., access to loans).

The scope of the SEBS report will be determined by the regulator. Nevertheless, the Law states that the SEBS report shall be filed annually and it shall include:

i)             positive discrimination to achieve equal treatment for both male and female employees;

ii)            search for and promotion of sustainable social and human resources within the firms;

iii)            a further reduction of environmental impact and a more sustainable use of natural resources.

The Law also foresees the creation of an open access registry which shall be readily available on the CBA’s official website. This registry will list the firms that filed a SEBS report and will also provide information on the firm which fails to file their mandatory SEBS report.   

The Law considers as infringement the obstruction, misreporting and hiding of relevant information contained in the SEBS report. Not filing a mandatory SEBS report shall also be regarded as infringement.