6 June 2006

Company law key to tackling poverty, groups tell Tony Blair

Prime Minister targeted with open letter as Company Law Reform Bill enters House of Commons 

The Prime Minister is urged to follow up on his commitment to tackling global poverty today as the Company Law Reform Bill enters the House of Commons. Charities, human rights, environment and development groups, trade unions and faith groups say the Bill represents a once-in-a-lifetime opportunity to ensure that business operates for the benefit of people and the environment.

They have called on the Prime Minister, in an open letter, to follow up on his public commitments to more sustainable development and amend the Bill so that company directors have a legal duty to take reasonable steps to minimise the harm their company may cause to local communities and the environment.

The letter, which has been coordinated by the Trade Justice Movement and the Corporate Responsibility (CORE) coalitions also calls for a legal requirement for companies to report on their social and environmental impacts and improved access to legal action in UK courts for people overseas affected by the impacts of a UK company.

Glen Tarman, Coordinator of the Trade Justice Movement, said:

"The Company Law Reform Bill provides the Prime Minister with a real opportunity to deliver further on his public support in 2005 for the aims of Make Poverty History. UK companies do not always consider the impact of their activities on the environment and local communities when they trade overseas. The law currently recognises that companies may wish to consider the impacts they have but this is not enough to bring about trade justice. The Government must be bolder in their approach and ensure that UK companies become a real force for good rather than, as is too often, a cause for shame."

The letter follows pleas from more than 100,000 people around the country who have urged their MPs to support these changes to the Company Law Reform Bill. A recent poll of the general public found that 90% of UK voters agreed that "the Government should set out enforceable rules to ensure companies are socially responsible".

Notes:

1. Text of the open letter to the Prime Minister on the Company Law Reform Bill Tuesday, 6 June 2006

Dear Prime Minister,

We the undersigned - representing companies, think tanks, charities, human rights, environment and development groups, trade unions and faith groups - are writing to urge you to deliver further on your public support in 2005 for the aims of Make Poverty History by amending the Government's Company Law Reform Bill. We believe that the Bill is a once-in-a-generation chance to ensure that UK companies conduct their business dealings in a manner that is profitable, ethical and truly sustainable. 

In 2002, at the World Summit on Sustainable Development, you set out a vision for a global future based on sustainable and fair development, on "globalisation with justice". We agree with you, but believe that ensuring real justice needs to address the role that we in wealthy nations play in contributing to or causing the problems poor countries face.

Some UK companies set a positive example of how profitability and ethical business can go hand in hand by making major contributions to the communities where they operate. Yet organisations in the Trade Justice Movement and Corporate Responsibility (CORE) Coalition have provided evidence of numerous examples of corporate abuse by UK companies. We believe it is time that companies are made more accountable for their impacts.

The British public agree with us. A recent poll showed that 90 per cent of voters think "the Government should set out enforceable rules to ensure companies are socially responsible". The public must be confident that British companies are not profiting at the expense of people and the environment. This means a framework of Company Law that places greater emphasis on social and environmental performance. 

This Bill, being debated in the Commons today, offers your Government a unique opportunity to ensure that British businesses are responsible and accountable, no matter where in the world they operate. We urge you to amend the Bill so that:

1. Companies are legally required to report on their social and environmental impacts.
2. Directors have a legal duty to take reasonable steps to minimise the harm their company causes to local communities and the environment.
3. People overseas who are harmed by a UK company and denied justice in their own country can take legal action in a UK court with access to legal aid. 

The Government has rightly recognised that this Bill is the correct place to deal with the environmental and social impacts of corporate behaviour. However, a far bolder approach is urgently needed if British companies are going to play their part in making poverty history. 

Yours sincerely, 

2. Signatories to the letter are:

Deborah Doane, Director, Corporate Responsibility (CORE) Coalition
Glen Tarman, Coordinator, Trade Justice Movement
Richard Miller, Director, ActionAid UK
Kate Allen, Director, Amnesty International UK
Jacqui Mackay, National Coordinator, Banana Link
Richard Bennett, General Secretary, BOND (British Overseas NGOs for Development)
Penny Newman, Chief Executive, Cafédirect plc
Chris Bain, Director, CAFOD
Maggie Robbins, UK Director, Centre for Corporate Accountability
Paul Valentin, International Director, Christian Aid
Miles Litvinoff, Coordinator, Ecumenical Council for Corporate Responsibility
Tony Juniper, Executive Director, Friends of the Earth England, Wales & N. Ireland
David Forsdick, Barrister, Landmark Chambers
Martyn Day, Senior Partner, Leigh Day & Co
Fay Mansell, Chair, National Federation of Women's Institutes 
Wendy Martin, Editor, New Consumer Magazine
Graham Bennett, Director, One World Action 
Barbara Stocking, Director, Oxfam GB
Ian Leggett, Director, People & Planet 
Sophie Paton, Co-ordinator, Peru Support Group
Mark Serwotka, General Secretary, Public and Commercial Services Union
Paul Noon, General Secretary, Prospect
Paul Chitnis, Chief Executive, Scottish Catholic International Aid Fund (SCIAF)
Ben Gilchrist, Director, SPEAK
Matthew Frost, Chief Executive, Tearfund
Paul Chandler, Chief Executive, Traidcraft Exchange
Charles Middleton, UK Managing Director, Triodos Bank NV
Jeremy Wagg, Executive Director, Relationships and Marketing, Unity Trust Bank plc
Louise Richards, Chief Executive , War on Want
Benedict Southworth, Director, World Development Movement
Robert Napier, Chief Executive, WWF-UK
Rt Revd. Dr Michael Nazir-Ali, Bishop of Rochester
Rt Rev Tim Stevens, Bishop of Leicester

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