Archived press release

Business Review is no replacement for full environmental reporting

24 January 2006

Friends of the Earth today (Tuesday 24 January) accused the Government of attempting to cover the Chancellor's disastrous decision to abolish the Operating and Financial Review by hyping new guidelines on environmental reporting, published today. The new Environmental Key Performance Indicators, launched by Elliot Morley today, are designed for companies complying with the Government's Business Review [1].

Friends of the Earth said that urging companies to adopt the new guidelines would not provide an adequate indication of a company's true impact on the environment. Although companies may need to report on environmental issues under the Business Review, introduced to comply with the EU Accounts Modernisation Directive, the level of reporting required is much lower and therefore of much less value to investors and stakeholders, the environmental campaign group said.

Friends of the Earth has launched a High Court challenge of the Government's decision to abolish the Operating and Financial Review - which was the only piece of UK legislation requiring companies to report on their environmental impacts.

In contrast, the Business Review does not require companies to provide the level of verification required by the OFR; does not require companies to report on social issues (such as the risk of human rights abuses); and does not ask companies to report on what they intend to do about perceived environmental problems (eg climate change).

Friends of the Earth Corporate Accountability Campaigner Craig Bennett said:

"The Government is trying to have its cake and eat it - but the result is smorgasbord of confusion. And the result is that neither investors or the wider public will be any the wiser as to what a company is doing.

"Glossy CSR reports that provide a one-sided version of a company's environmental performance are of absolutely no use to anyone. Business has an important role to play in tackling the big environmental issues such as climate change. What we need is proper reporting, with key performance indicators and clear information as to how companies are going to tackle the environmental issues they face."

Notes

[1] www.defra.gov.uk/news/2006/060124b.htm

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Published by Friends of the Earth Trust