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Company Law Reform Bill [HL]

I am obliged to the noble Lord. I am not complaining at all, we just want the record to be clear about which amendments he has spoken to. All those amendments would move us towards a more pluralist approach to the duties of company directors, in different ways. A decision was taken not to go down that road. If the noble Lord, Lord Avebury, will permit me to say so, I admire the ingenious way that we move through the structure of a clause about enhanced shareholder value into one that does something else; by changing, for example, ““business”” to ““ethical”” one changes the whole thrust of what is said. It is more than theoretically possible to require directors to serve a wider range of interests not subordinate to or as a means of achieving shareholder value but as valid in their own right. That is essentially what the noble Lord is arguing for. However, the Company Law Review and the Government have carefully considered the case for a pluralist approach. There are three main reasons why the Government did not consider it the right way forward. First, a pluralist approach would unhelpfully muddy the waters. Directors would lack clarity about what they were meant to be doing, and it would be more difficult for anyone to hold them to account in practice. Secondly, company law reform is not a suitable vehicle for our wider agenda on corporate social responsibility. Issues such as environmental protection and health and safety are enormously important, and the Government take them seriously. We do not think, however, that they should be addressed through company law reform. I agree with the point made by the noble Lord, Lord MacGregor of Pulham Market, on that. Thirdly—tying in a little with the point made by the noble Lord, Lord Wade of Chorlton—we believe that the best way to promote responsible business behaviour is to show how such behaviour leads to business success. We hope that people will see that, in some of these areas, business success ties in and chimes well with having full regard to some of these considerations. I have spent a few moments dealing with those amendments because they are important. I hope that I have indicated how the Government see these provisions and, inevitably, invite the noble Lords not to press their amendments.