CSR
is essentially about companies moving beyond a base of legal
compliance to integrating socially responsible behaviour into
their core values, in recognition of the sound business benefits
in doing so. Since businesses and the challenges they face
differ widely, government interventions need to be carefully
considered, well-designed and targeted to achieve their objective
The Government’s approach is to encourage
and incentivise the adoption and reporting of CSR through
best practice guidance, and, where appropriate, intelligent
regulation and fiscal incentives. This page highlights the
key elements of our approach.
Pensions Act Amendment
This legislation came into effect in July 2001 and requires
trustees of occupational pension schemes to state their policy
regarding the extent to which social, environmental or ethical
considerations are taken into account in the selection, retention
and realisation of investments.
Transparency
UK businesses are consistently among
leaders in surveys of CSR reporting: in the Global Reporters 2006 Survey.
UK companies were rated the top 3 reporters. And over 80% of FTSE
100 companies report on social and environmental issues (CorporateRegister.com)
The Government encourages companies to report
on their CSR performance in a number of ways:
Companies Act 2006
The Companies Act 2006 brings the regulatory
framework up to date to reflect the modern business environment. It
enshrines in statute the concept of Enlightened Shareholder value
which recognises that directors will be more likely to achieve long
term sustainable success for the benefit of their shareholders if their
companies pay appropriate regard to wider matters such as the environment
and their employees.
All companies, other than small, must already prepare
a Business Review as part of the director's annual report. From October
2007, quoted companies must also - to the extent necessary for an understanding
of the company's business - disclose information on environmental, employee,
social and community matters, as well as on contractual and other arrangements
essential to the business. We believe this will add real value to the quality
of narrative reporting and promote responsible business behaviour, without
imposing undue burdens on business. Find out more here
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