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Companies Bill [Lords]

I am pleased to be able to make a short contribution to the debate. I was pleased to hear the hon. Member for Bedford (Patrick Hall) say that his new clause was pro-business. It is important for all of us that our companies should continue to be successful. However, the world is changing and—as the right hon. Member for Suffolk, Coastal (Mr. Gummer) rightly said—we are all now much more concerned about the environment and climate change. Companies are going to have to change along with that. The hon. Member for Portsmouth, North (Sarah McCarthy-Fry) made the point that there is a philosophical argument involved. To whom does a company owe a responsibility? Is it, as the existing law states, only to its shareholders? Incidentally, those shareholders tend these days to be other big companies or institutional investors, which creates a kind of circle. That is where the idea of enlightened environmental shareholder action begins to fall down. Other big companies control each big company, so unless all of them have an interest in doing something about the environment, I do not think that we should get very far. To whom does a company owe a duty? Traditionally, it has been purely to its shareholders—but in the changing world in which we live, where we need to tackle climate change, companies must also owe a duty to the wider society, as the right hon. Member for Suffolk, Coastal rightly said. New clause 4 would point directors along the route of thinking about their duties towards the community and the environment.