‘The world needs business at its best’
This is the opening quote on the Better Business Act website and it is an incredibly important one, because better business means a better world. After the latest IPCC report it is clear more needs to be done to improve the current climate situation and businesses are one of the biggest culprits for not taking accountability across a wide net of problems, this is where the Better Business Act comes in.
For those not aware, the Better Business Act is campaigning to include four key principles in section 172 of the Companies Act. By adding these principles, that are outlined below, it will become law and no longer choice to align the long-term interests of people, planet and profit.
1.Aligned Interests
The interests of shareholders are now advanced alongside those of wider society and the environment. This establishes a new principle of fiduciary duty within Section 172 of the Companies Act.
2. Empowering Directors
This change must empower directors to exercise their judgement in weighing up and advancing the interests of all stakeholders.
3. Default Change
This change must apply to all businesses by default. It must no longer be optional to benefit wider stakeholders beyond shareholders.
4. Reflected in reporting
Following this change, businesses must report on how they balance people, planet and profit in a strategic report or impact report, where one is currently required.
Since the launch of the Better Business Act earlier this year the organisation has made incredible progress with 750 supporters signing up across the UK for a cleaner, greener and fairer future. The coalition has been receiving growing support from MP’s and has been featured as a solution in the British Academy future of the corporation programme. Introducing this amended change to the Companies Act will ensure all companies in the UK, regardless of size, align the interests of their shareholders with those of the wider society and environment. The movement is incredibly important for the acceleration of a carbon free future and forcing businesses to take accountability.
To join CAFA in supporting the coalition sign up with the following link: https://betterbusinessact.org/act-now/