Public policy is still in its infancy with regard to corporate responsibility but Briefing will endeavour to keep you up-to-date on any government-related news and developments.
Reporting on public policy issues does give one a strong sense of déjà vu. This is not simply because the Queen’s Speech is an annual event. Rather, it is related to the strong impression that the UK government does not have a clear and consistent policy on corporate responsibility – especially in regard to reporting.
It was two years ago that Gordon Brown, the then Chancellor, made the bombshell announcement that he was to scrap the proposed requirement for an Operating and Financial Review in a company’s annual report and accounts. Then, just twelve months ago, business leaders were up in arms about alternative proposals from Margaret Hodge on different reporting requirements.
We now know that the reporting requirements contained in Section 417 of the Companies Act 2006 will require a fair review of the company’s business and a description of the principal risks and uncertainties – including information on social, environmental and community issues. However, at the time of writing, Stephen Timms, minister of state for competitiveness, has made an unexpected announcement delaying many of the provisions of the Act until October 2009.
As things continue in a state of flux and uncertainty, there is a need for a strong heart and clear guidance.
Briefing will endeavour to provide both in reporting on further developments in this area.
Related News
Pre-Budget Report and Comprehensive Spending Review 2007
The government’s Pre-Budget Report and Comprehensive Spending Review 2007 was announced by the Chancellor of the Exchequer, Alistair Darling, on October 9, and had a number of implications for business. The relevant points with regard to corporate responsibility were:
Reform in the taxation of air travel to “better reflect the environmental costs” and the establishment of a £1.2bn Environmental Transformation Fund, which will “support the deployment of new energy technologies in the UK and abroad”.
An increase in overseas aid as a share of national income from 0.37 % in 2007/2008 to 0.56 % in 2010/2011.
Reform of the capital gains tax by introducing a single rate of 18% from 2008/2009.
The UK has committed itself to reducing carbon dioxide emissions by 60% by 2050 according to the Climate Change Bill announced in the Queen’s Speech. The bill will make Britain the first country to legislate on carbon emissions and it will apply to the whole of the UK, not only England. Its main aim is to create a long-term legal framework to reduce Britain’s impact on global warming.
The Queen announced the legislative agenda for the year ahead in her annual Queen’s Speech on November 6. The other bills potentially relevant to the corporate responsibility agenda are:
Dormant Bank and Building Society Accounts Bill, which would enable unclaimed assets to be invested for community purposes but will ensure that the rights of owners to be reunited with their assets are protected.
Education and Skills Bill that will require all 16 to 18-year-olds to remain in education or training. It will also consider the implications of the Leitch Review of Skills published in December 2006.
Employment Bill, which calls for the stronger protection of workers’ rights and that employers “understand and abide by their responsibilities”.
The Queen’s Speech is written by the government and is delivered by the Queen and forms the main event of the state opening of Parliament.
On October 22 Prime Minister of the UK, Gordon Brown, hosted the first meeting of the newly established business advisory body – the Business Council for Britain. The group is due to meet three times a year to advise the government on issues that affect the business community as well as the broader economy.
Members include Richard Branson, of Virgin, and Terry Leahy, of Tesco. The first meeting included discussion of globalisation and the need for it to be inclusive, adult skills, intellectual property rights as well as climate change and energy security.
John Edwards has called for the renewal of the “social compact between business, government and families” that typified the 20th Century in the US and saw the “strongest middle class in history” built. Speaking on October 26, the Democratic presidential hopeful, outlined a plan that aims to restore corporate responsibility and help families to achieve financial security. The plan would involve:
modernising the social contract with universal health care and retirement savings, which would follow workers from job to job;
holding corporations to account with stronger corporate responsibility law and consumer protections.
Edwards was speaking in Des Moines, Iowa, as part of a seven-day Stand Strong campaign.
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