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Trade committee to Government on company law: "get on with it".
13 May 2003
The Trade and Industry Select Committee today published its sixth report "The White Paper on Modernising Company Law".
A key finding, welcomed by Friends of the Earth, is that the Government should make publishing the Companies Bill a high priority [summary, page 3]. However, it does not recommend extending the number of companies required to produce "Operating and Financial Reviews" beyond the 1,000 top firms already suggested by the Government. It also does not recommend and explicit commitment to reporting on companies' environmental and social impacts, although it believes that Government proposals will mean that "in practice directors will not be able to get away with assuming that environmental and social impacts are not relevant to their company and can be passed over without comment." [para 70, page 23]. Elsewhere in the report however, the Committee notes that "there is considerable scope for interpretation and it is therefore hard to anticipate the impact of the legislation as currently drafted" [para 21, page 9].
Commenting, Friends of the Earth Parliamentary Co-ordinator Martyn Williams said:
"We very much welcome the Select Committee's demand that the Government should get a move on and publish the Companies Bill. But the draft Bill still needs strengthening in important ways if we are to make sure that company directors really do have a duty to consider the environmental and social impacts of what their company does.
We also want to see the number of companies required to produce the new style company reports extended well beyond the 1000 largest, covering less than a third of total UK economic activity. All directors should be required to consider the effect of their company's behaviour on society and on the environment".
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Published by Friends of the Earth Trust
Last modified: Jun 2008
