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Monday
1st October
Companies
Act becomes law, but Brown needs to go further to achieve targets
Leading
campaign groups today welcomed the Companies Act (that becomes law on
October 1), but called on Gordon Brown to make sure that the act is the
first step to further reforms on the government’s thinking on
business, poverty and the environment.
The Act represents the biggest shake
up in company law in 150 years and will for the first time require the
largest listed companies to report on their social and environmental
impacts, as well as obliging company directors to take stock of their
business activities' effects on employees, communities and the
environment.
But
campaigners are concerned that the legislation lacks the teeth to make
business live up to their obligations, and fails to ensure that they can
be held to account for violating human rights and their impact on the
environment and the wider society.
"This gets us closer to the goal of corporate accountability"
said Jenny Ricks, corporates campaigner at ActionAid "But it's a
first step. Corporate accountability is still seen as an add-on to the
functioning of the economy. If the government is to live up to its
commitment to fighting poverty and climate change, we need to make sure
that ethical business practices become central to trade, investment and
development policy – and that strategy is joined up across
government."
Despite promises from government to draw up guidance for directors on
how comply with new reporting rules; companies haven’t been given any
official help to meet the Act’s requirements. The Corporate
Responsibility (CORE) Coalition has stepped in and created a set of
guidelines for businesses to help them comply with the new requirements.
These will be launched in the coming weeks.
The CORE Coalition’s Hannah Ellis said: “We’re happy to step in
and offer up some help to directors so that they can work with to the
new requirements. It is a little worrying though, that while we have
here a first step to making business more accountable, the government
hasn’t delivered the guidance to go with it.”
Media contacts:
Hannah Ellis, The Corporate Responsibility (CORE) Coalition: 07952
876929
John Coventry, ActionAid
UK
: 0207 561 7633 / 07734 581 738
New Resource: Find out what tools are
available in the Companies Act to help challenges companies by checking
this guide.
Act
Now! A Campaigner’s Guide to the Companies Act by CORE
coalition and the Trade Justice Movement (pdf)
New Resource: ‘For more information on
what Company Directors must look out for, check the CORE coalition’s Directors
Duties Guidance (pdf)
Notes
1. An open letter sent by The Coalitions to The Prime Minister can
be viewed here
2. The Trade Justice Movement (www.tjm.org.uk)
is a coalition of over 80
UK
organisations campaigning for fundamental changes to the unjust rules
and institutions governing international trade, so that trade is made to
work for the benefit of poor people and the environment. Member
organisations that together have over 9 million individuals members
include development and aid agencies, Fairtrade bodies and companies,
environmental organisations, trade unions, student and faith groups. The
Corporate Responsibility (CORE) Coalition (www.corporate-responsibility.org)
is the
UK
’s most active voice on corporate accountability, supported by over
130 organisations, including campaigning organisations, faith-based
groups, community organisations, academic institutions and trade unions.
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