Archived press release

Need for new law on companies' green reporting

4 April 2002

BIG BUSINESS SCORNS PM'S CALL FOR GREEN REPORTING

Big business has scorned Tony Blair's call for green reporting, despite today's launch of a new global standard for social and environmental accounting. A coalition of groups has called on the UK Government to insist companies report because the voluntary approach has failed.

Today's launch of the Global Reporting Initiative (GRI) is the first step in establishing a standard for environmental and social reporting by corporations. However reporting will remain voluntary so most will continue to do little or nothing.

In October 2000, in a keynote address to the CBI, PM Tony Blair told business leaders:

“I would also like to see more reporting on environmental and social performance... I am issuing a challenge, today, to all of the top 350 companies to be publishing annual environment reports by the end of 2001”.

More than three-quarters of Britain's top companies have failed Blair's challenge. Government figures indicate that only 79 of the top 350 companies (23%) produced substantive reports on their environmental performance by the deadline, and that only 24 (7%) of the other companies on the FTSE350 had indicated their intention to do so. Ten percent of the remaining top 350 companies mentioned the environment in their annual reports, but in many cases it was given only a few short paragraphs.

Groups have united to call for binding rules of corporate accountability to be delivered by the government - including mandatory social and environmental reporting. But they are concerned that the Government may use the arrival of the GRI as a reason for not introducing mandatory rules. France, in addition to Denmark and Holland, is the most recent EU country to pass a law requiring firms to report on social and environmental issues, the UK should be following a similar path to greater corporate accountability. In the UK this effort is being lead by a coalition of leading NGOs, promoting a Corporate Reform Bill (CORE) in Parliament.

“Until Government shows signs of leadership, it is unlikely companies will bother telling us all the impact of their practices. Corporations are not choosing to make themselves accountable to society, but they must be": says Deborah Doane, chair of the CORE Coalition and Head of Corporate Accountability at the New Economics Foundation. "We need legislation to ensure that companies take social and environmental issues seriously"

"Tony Blair pleaded with UK companies to take their responsibilities seriously over reporting on the social and economic impact of their activities". FOE Director Designate Tony Juniper added. "But they have given the Prime Minister the cold shoulder. The voluntary approach has failed. Now we need a new law to make sure that companies make these reports and take the results seriously."

The UK Government has just completed the most extensive review of company law in almost 150 years and is expected to publish a new companies bill in 2002/3. The CORE Coalition is taking this opportunity to influence company law, so that it reflects stakeholder concerns and not just shareholders' interest. The Campaign supports a bill soon to be introduced to Parliament calling for increased Director's duties, reporting of social, environmental and economic impacts, and the rights of ordinary people.

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Published by Friends of the Earth Trust