UK: Private Member's Bill to clean up business reaches crucial reading
Mr King's Bill seeks to inject real substance into so-called 'corporate social responsibility' by requiring companies to report on the social and environmental impacts of their activities. It is backed by a coalition of charities, trade unions and church groups including Amnesty International UK, Christian Aid and Friends of the Earth.
If it became law the Bill would require businesses to produce annual reports on their social and environmental impacts, and would require Directors to consider the impact of their investment decisions on all of their stakeholders.
Andy King, Labour Party MP for Rugby & Kenilworth, said:
'I want to firm up rules on companies' ethical behaviour and end the current 'pick-and-mix' voluntary approach to corporate social responsibility. More than 300 MPs have expressed their support for more comprehensive laws in this area, and the weight of opinion in the UK means the government must act. People are concerned by the growing social and environmental impacts businesses have on their lives. The government must recognise this.'
The Bill includes two key elements:
- Mandatory reporting: Companies will be required to publish annual reports explaining the significant social, environmental and economic impacts of their activities;
- Directors' duties: Expands the present duties of company directors from just considering the financial success of a company to require them to also consider environmental, social and economic impacts of their activities, as well as the interests of all their stakeholders (not just shareholders).
The Bill would oblige companies to be open about their 'triple bottom line' - their social, environmental and economic performance - allowing investors to compare companies' performance and make their investment decisions on the basis of a fuller picture. It also spells out how corporate responsibility regulations for business could actually help the Government meets its sustainable development targets.
Amnesty International UK Director for Economic Affairs, Peter Frankental, expressed his support for the Bill:
'The current laws governing corporate conduct were set out nearly 150 years ago and are now completely inadequate in a global economy with complex supply chains. There have been too many cases of business complicity in serious human rights abuses in countries all over the world. We need mandatory social reporting to make companies accountable for their business activities, and to create a 21st century framework for business that ensures it is accountable to all its stakeholders.'
About the CORE Coalition
The Corporate Responsibility (CORE) Coalition was formed in response to the Government's failure in the Modernising Company Law White Paper to specify rules requiring companies to be more transparent and accountable to their wider stakeholders. The founding members of CORE were Amnesty International, Christian Aid, Friends of the Earth, New Economics Foundation and Traidcraft. The coalition is now supported by over fifty organisations, including NGOs, church groups and trade unions. www.corporate-responsibility.org .
Note to journalists
Andy King MP is available for interview. Contact Sarah Green at the AIUK Press Office for further details: 020 7814 6238/07721 398 984.