The Company Law Reform Bill

I have already signed an Early Day Motion in the House of Commons, which asks that the law should be changed so that company directors have to report on, and act on, the social and environmental impacts caused by their company’s activities both in the UK and overseas.

The Bill has been introduced into the House of Lords, so it is likely to be a few weeks at least before it reaches the Commons. It is an enormously long Bill, with 885 clauses and 15 schedules, running to over 500 pages, and covering a very wide range of issues, ranging from the constitution of companies, to takeovers and mergers, political donations, and the responsibilities of auditors. There are also sections which deal with the responsibilities of directors, in which it might be possible to raise the amendments necessary to cover the points brought up by the EDM.

Recently I was in a meeting of a group of MPs about the Bill, where we discussed how to deal with a number of the issues it raised. With such a huge Bill it is going to take a considerable amount of work to do this. We are going to arrange to meet with a number of interested parties, including the organisations pressing for the sort of changes I mentioned above, to see how we can best take forward their concerns.

At this stage I cannot tell you precisely what we will do, partly because until the Lords finish dealing with the Bill we cannot be sure what amendments may already have been made by them before it comes to the Commons. I can, however, confirm that we will be looking at how to take forward the issues around social and environmental impact.

April 2006

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