When a business registers with Companies House it has to comply with the Companies Act 2006. Section 172 relates to directors’ responsibilities and their duty to promote the success of the company for the benefit of all stakeholders, not just shareholders. This includes employees, suppliers, customers, the community and the environment. Decisions should be made with a long-term view and the company must maintain a reputation for high standards of business conduct.
The Better Business Act (BBA) campaign seeks to amend Section 172 so that all businesses, big and small, are legally responsible for their social and environmental impact, ie it’s no longer optional. BBA proposes a change to the wording that incorporates these four principles:
- Aligning interests of wider society and the environment alongside shareholders.
- Empowering directors to make better decisions.
- Applying this change to all businesses by default.
- Businesses report on how they balance people, the planet and profit.
Over 1500 companies have chosen to be part of the coalition for a cleaner, greener, fairer future for all. The campaign is run by B Lab UK, the organisation behind the B Corp movement. They plan to:
- Give a voice to the majority who want this change.
- Build a coalition of leaders.
- Drive forward BBA’s ask to the government.
Go to the BBA website to get involved by finding out more, joining the coalition and writing to your MP.