Cameron afraid of big business, say campaigners

Cameron afraid of big business, say campaigners

Conservative moves to water down company directors' obligations to protect the environment and communities show David Cameron's claims to stand up to big business are hollow, according to a coalition of 120 campaign groups and unions.

The Trade Justice Movement has joined with unions and church leaders in a scathing attack on the Tory leader and is demanding a meeting with him. They are furious the Conservatives are opposing key parts of the Company Law Reform Bill, which is due to go to committee this week after its second reading in the House of Commons.

The Tories will table two amendments on the contentious clause that refers to directors' duties. Earlier this year, Conservative peer Lord Freeman - chairman of the arms company Thales and once a minister in John Major's government - tabled amendments weakening the requirement for directors to have regard to the impact of a company's operations on the community and environment. Though the amendment was defeated, last week shadow Trade Secretary Alan Duncan told the Commons that clause 158 was 'inflexible' and would cause 'confusion'.

The Conservatives appear to be backing the CBI and Law Society's furious campaign to reword the clause. Both argue it will create more red tape.

The Conservative position is at odds with Cameron's recent calls for good corporate citizenship and his pledges to stand up to corporations behaving badly.

Alex Wijeratna, an Action Aid campaigner, said:.....continued below

Advertisement starts

---

---

Advertisement ends

'The bill as it stands says that directors pay due regard to the environment and communities. It is vital this clause is enshrined on the statute books. The Conservatives are using weasel words and spurious argument to block this. It shows that Cameron's claims not to be swayed by business appear to ring hollow.'

Labour MP Paul Farrelly, a member of the standing committee on the bill, said: 'We need a robust Companies Act which places duties on directors with reference to the communities and the environment. You can't tell people to vote blue, get green and then backpedal by subterfuge.'

Duncan said: 'Everything we're doing is designed to champion corporate social responsibility in its best practice. We have put CSR at the heart of our agenda and are determined to make sure that Britain sets the lead in the world in the way our businesses behave.'

The Conservatives ask why six duties should be placed on directors in the bill when there are 650 common law duties. In addition, they say the legislation should not apply to small businesses. But campaigners say this is simply a device to block the clause.

The CBI is trying to get the clause redrafted so it puts more emphasis on a director's judgment.

The Company Law Reform Bill has been seven years in the making. Alistair Darling, the Trade Secretary, said it now has 950 clauses and runs to 547 pages.

Guardian Unlimited © Guardian Newspapers Limited 2006