The government has backed down from introducing new regulations forcing UK companies to report on their economic, environmental and social impacts - campaigners said today. Failure to announce new legislation in the recent Companies Bill White Paper has been criticised by the Corporate Responsibility Coalition (CORE), whose members includes Amnesty International, CAFOD, Friends of the Earth and Traidcraft. Katherine Astill, Private Sector Policy Analyst at CAFOD, said: "Mandatory social reporting would be good for developing countries and for business. Reporting would act as an incentive for companies to improve their impact upon working conditions and local economies, and it would reduce risks which could threaten profit." While CORE welcomes changes that benefit small and medium business, the White Paper does not adequately address the impacts large companies have on society and the environment. Pressure for government legislation has grown with the failure of voluntary initiatives on corporate responsibility during the last two years: A plea by Tony Blair for business to voluntarily comply was ignored by three quarters of the UK's top companies. This has been further compounded by the recent wave of corporate scandals rocking the US business community. Hopes that legislation would be included in the White Paper were raised earlier this month, when Trade Secretary, Patricia Hewitt, said the government needed to promote 'responsible business' and would be introducing the 'necessary regulation'. However the White Paper makes it clear that the government will continue to rely on the voluntary regime that has proven costly and ineffective. CORE is backing Linda Perham MP's Corporate Responsibility Bill, recently tabled in the House of Commons, which calls for increased director's duties beyond the financial bottom line, and mandatory reporting on the economic, environmental, financial and social impacts of corporate operations.
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