CSR election promises are thin on the groundApril 2010
With voting on a new government imminent in the UK, what do the main political parties have to say on the issue of corporate responsibility? EP looks at their plans
Britain’s three heavyweight political parties appear set to move into the forthcoming general election with policies on corporate responsibility that, to put it politely, are long on generalisations and short on specifics. Partly this is attributable to the fact that all are proponents of a voluntary approach to CSR – and by definition are therefore unlikely to be drafting many new regulations if voted into power.
But it’s also because, at heart, none of them sees the need for a significant change in the overall status quo on such matters – despite the loss of trust in business that has resulted from the recent financial crisis. Broadly, the Liberal Democrats would slightly tighten existing regulation and promote alternative forms of corporate ownership, while the Conservatives want a lighter regulatory touch in exchange for ‘responsibility deals’ with businesses, and Labour is promising more of the gently cajoling stance it has taken during the past few years.
More details may emerge as the campaigns go into full swing, but here is what the parties are saying at this point in the proceedings:
The Lib Dems are clearest about what they would actually do in power. While they favour deregulation in general, they would resurrect Labour’s plans, dumped by Gordon Brown in 2005, to require large companies to produce an annual Operating and Financial Review. They would rename the OFR a ‘Social Responsibility Report’ and make clear that it should ‘report fully on a company’s environmental and employment practices and its involvement in the communities in which it operates’. It should also be audited.
The party would encourage what it calls ‘a wider variety of business structures’ such as mutuals, social enterprises and co-operatives, which it believes are more likely to embed social responsibility in their day-to-day operations. However, it is not specific about how it would do this.
On climate change, the Lib Dems have said they will require mandatory carbon reporting on investments for all businesses and ‘an end to public money going into unconventional fuels such as tar sands’. They would also extend the coverage of the existing Carbon Reduction Commitment to bring in full auctioning of allowances.
While the party has additionally made a commitment to focus on promoting fair trade, specifics have not so far been released.
David Cameron’s party has perhaps the most distinctive, but also the most cloudy, take on corporate responsibility.
In opposition during the past three years it has been thinking fairly hard about its position, and a working party came up with a number of recommendations. How many of these will become official party policy remains unclear, even this close to the election, but their corporate governance spokesman Jonathan Djanogly told EP the party is ‘standing by what has been said in the past’.
The Conservatives have already talked in some detail to businesses about one of the key working party ideas – the creation of government-brokered responsibility deals committing companies to CSR measures in return for a lighter regulatory regime. It claims to be ready to put deals in place on packaging and on obesity if it comes to power.
Other recommendations that may make it as official policy include the idea of requiring an advisory vote at AGMs on a company’s sustainability report, forcing investors to report more fully on any actions they have taken to support SRI, and providing more resources to the UK’s National Contact Point to follow up complaints that British companies are failing to live up to the OECD guidelines.
These more regulatory focused ideas may have less chance of making it into the election speeches, as Djanogly has said that ‘in cutting state control we wish to expand responsible business practice as an alternative’. But expect the Conservatives to talk more about ‘social responsibility’ – both personal and institutional – than the other parties, as this is one of their main campaigning planks.
Labour’s approach to CSR is generally acknowledged to have stagnated since the early days under Tony Blair, and the party appears to be struggling to come up with any new ideas in the sphere. On request, the party issued a statement to EP that, while emphasising its continued commitment to corporate responsibility, spoke mainly of supporting existing voluntary initiatives. Unless something turns up in the manifesto or as a surprise announcement during the campaign, there are no new programmes or policies on offer.
Labour headquarters told EP: ‘We encourage CSR on the basis of a voluntary and business-led approach. We believe that a key element of government’s role in promoting CSR is active engagement with a wide range of stakeholders, including business representative organizations, civil society groups and NGOs, trades unions and community bodies.’
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