The decision marks the first time that a European year has been dedicated to external EU policy, and comes as the millennium development goals draw to an end and decisions on a post-2015 international framework must be taken.
Parliament's rapporteur on the year Charles Goerens explained, "There can be no question of ignoring the more than 100 million poor people in EU countries or of pitting them against the poor and destitute elsewhere.
"What we would like the core message of this year to be is that human dignity, aspiring to a dignified life, does not stop at the borders of our continent and should not depend on where a person is born or lives.
"This is why parliament has insisted on putting the dignity of every human being on this planet at the centre of the European year for development by choosing the motto: our world, our dignity, our future", said the ALDE deputy.
"The agreement we have reached with the council and the commission means that for the first time a European year is designated to an external policy, to a concern of global scope.
"This is no coincidence, because in 2015, developing and rich countries will jointly decide, within the United Nations, on a new agenda and goals to follow the millennium development goals," he explained.
EU foreign affairs chief Catherine Ashton and European parliament president Martin Schulz issued a joint statement on the establishment of the theme, which has been informally agreed with the council of ministers.
The pair said, "The European consensus on development is the compass for the actions under the European Union's development policy.
Presently, the EU is the largest aid donor in the world, and Ashton and Schulz described European development policy as "a true success story of which the European Union can be proud".
They continued, "In a rapidly changing world, the EU must remain committed to this policy. It must continue to be the leading donor of official development assistance and remain at the forefront in the fight for the eradication of poverty.
"This signature… gives renewed impetus to the EU's engagement towards developing countries.
The pair also said that the "renewed commitment is both timely and significant" in light of the recent EU-Africa summit.
"The signature underscores that the EU's determination to eradicate poverty is as vital today, the last year for the achievement of the millennium development goals, as it was when the consensus was first signed at the end of 2005, before the creation of the [European external action service]," they concluded.
The decision was welcomed by development NGO Concord, with board member Marius Wanders saying, "The European year for development should not be only about aid - what Europe gives - but also about the consumption choices that we make as citizens that affect global development.
"Having a European year in 2015 for development would be perfect timing. It's the year when important global agreements to decide how to tackle global poverty will be negotiated. The next European year should aim to be an open public debate with citizens," he concluded.