4. Campaign Successes So Far – The Background To The Companies Bill

Company Law Takes A Step Forward...

From October 2005 to October 2006 the UK Parliament discussed a Bill to modernise UK Company Law; the bulk of which was 150 years old. This was an unprecedented opportunity to make laws to help stop companies profiting at the expense of people and the planet and with many others SPEAK demanded improvements to company law in line with our campaign goals.

Well Done!

Thanks to your determined campaigning and faithful prayers we have achieved some important improvements to UK company law. The Companies Bill has now become law (as the Companies Act 2006). In the Act the UK Government has recognised that UK companies need to be made more accountable for the impact of their activities in the UK and overseas. This is an important first step towards stronger laws for greater accountability of multinational companies and is a fantastic achievement due to our important influence on the Bill showing that we really can make a difference! SPEAK’s Big Dress Campaign, as part of the Trade Justice Movement (TJM) and Corporate Responsibility (CORE) Coalition, will maintain this momentum and keep up the campaigning to right corporate wrongs.

What Have We Achieved?

A. Real Improvements To UK Company Law
The resulting Companies Act 2006 shows that campaigning really works! Thanks to your efforts, we achieved some significant improvements to the legislation during its passage through Parliament, and prevented steps that would have focussed the Bill solely on company directors’ obligations to put shareholder profits above all other concerns.

1. Stronger Social And Environmental Reporting Requirements
Thanks to over 100,000 UK voters contacting their MP in 2006 by email, postcard, letter and local lobbying, the Government strengthened the requirements in the legislation on social and environmental reporting so that the 1300 companies quoted on the UK stock market must report on the following issues where they are necessary to understanding the company’s business:
• Environmental matters (including the impact of the company’s business on the environment)
• The company’s employees
• Social and community issues
• Risks down company supply chains
The Government also gave a commitment to review, within two years, whether or not voluntary reporting standards had resulted in meaningful reports and to consult with civil society as well as business in this assessment. If not, the Government has undertaken to use the powers it will have within the Bill to introduce mandatory reporting standards.

2. Directors’ Duties On Environmental And Social Matters
Directors of UK companies now have a duty not only to maximise profits but also to consider the impacts of their business operations on the community and the environment. This is the first time that such responsibilities have been written in UK company law, and we know of no other country in the world that demands in law this kind of responsibility from company directors.

The Government also put in place a link between the reporting requirements and the directors’ duties in the Companies Bill, making it clearer that the reports must show how directors are performing on their duties to society and the environment, bringing responsibility for reporting to the Boardroom level. A new provision to the law now recognises that some companies can be run for purposes other than to make profits. Lastly, the Government have committed to publishing advice on how directors’ should interpret their duties, helping them understand exactly how they should take social and environmental matters into consideration.

B. Widespread Support For Our Campaign
Your campaigning has brought about a major increase in awareness about the need for laws to hold companies accountable laying the groundwork for more progress in the future.
• MP Support: Over one third of all MPs (225) signed the Parliamentary petition (EDM 697) tabled in support of our proposed amendments to the legislation.
• Debates: Our concerns about social and environmental issues dominated all the debates in Parliament and were represented by MPs from all parties.
• Postcards: MPs told us this was one of the biggest postcard campaigns ever - over 100,000 UK voters contacted their MPs!

“I received a staggering number of letters from constituents sharing concerns
and contacted the Minister to urge her to amend the Companies Bill.”
Diane Abbott MP, Hackney North and Stoke Newington

C. Coverage in the media
The story was widely covered by the media including regular stories in The Guardian and Financial Times and TV and radio interviews with coalition members. The work done by CORE and the TJM positioned the coalitions as key voices in debates around corporate accountability, which is a great platform for future campaigning. Indeed, the FT reported, “business had been comprehensively outmanoeuvred by environmental and corporate responsibility campaigners, in a stunning lobbying victory.”

Impressive coverage included important articles in The Guardian (and ActionAid’s full page celebrity advert asking MPs to back our amendments) - see http://business.guardian.co.uk/story/0,,1932620,00.html and http://business.guardian.co.uk/story/0,,1926631,00.html (John Battle MP’s article on rights of redress for affected communities).

D. Inspiring New Campaigns Around The World
Our groundbreaking campaigning has inspired coalitions in other countries to press for changes in their laws to make companies more accountable.

What Next?
There is still a long way to go to make UK business profitable, ethical and sustainable, as not all of our concerns with the Bill were tackled but we have made a good start. We welcome the changes in the law so far but much more is still needed to ensure people and the environment are protected. The Act does not go far enough in ensuring UK business always behaves responsibly. For example, the stronger reporting requirements will not be applicable to large privately owned companies such as Virgin. We also still need to ensure that the Government follows through on the commitments it has made as part of the Act.

SPEAK are committed to further praying and campaigning as the Big Dress Campaign continues to keep up the pressure on these issues and to ensure companies are made legally accountable for their impact on people and planet:
• Working with allies across the world we will push for international regulation of multinational companies at a European and global level.
• We will also be part of monitoring how the Companies Act 2006 works in practice and pushing for rights of redress for communities negatively impacted by UK companies operating overseas, especially in poor countries.

Please keep taking action with us, look out for mailings and email actions, check the website (www.speak.org.uk), and get in touch for more information on how you can support the next stage of the campaign (see the action suggestions later in the booklet as well). Pray with us for the next steps in the Big Dress Campaign and the implementation of the Act, that both would be effective, and that we can keep on making a difference!

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