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Companies Bill [HL]

My Lords, as the Minister will remember, there was considerable discussion of the role of companies in the developing world when the Bill went through your Lordships' House, and those issues were picked up in the Commons. I give a guarded welcome to the Government’s Amendment No. 245A, which acknowledges that there are issues relating to labour standards and environmental, social and human rights impacts down companies’ supply chains which need to be addressed. However, the amendment is still pretty weak; it does not go as far as the OFR, which the DTI had proposed and the industry had accepted but which the Chancellor then knocked out last year. As the Minister emphasised, under the amendment it will remain the directors’ judgment of what is relevant in the supply chain for them to report on. It will not require companies to list their suppliers. It also affects a limited number of suppliers, so it is a limited amendment. On Amendment No. 245B, I would like to know more about the circumstances in which directors could withhold information. I would not want this to be Trojan horse in the middle of the legislation. I believe that Amendment No. 245C should be opposed. It is significantly weaker than the Government’s amendment and would undermine the provision of information to shareholders about risks down company supply chains. Meanwhile, the amendment of my noble friend Lord Razzall would ensure a much more independent framework for the Government’s proposals. It would mean, for example, that companies could be compared across years or between themselves; less would depend on the judgment of the directors and more on outside standards, which is vital. It should help companies see what they need to do, as the noble Baroness pointed out. It strikes me as ironic that this week, with enormous acclaim, the Stern report was launched in the presence of the Prime Minister and the Chancellor. All agree that there has to be a sea change, as it were, in public, government and international thinking about what we are doing to our planet, how the poorest countries in particular will cope and what the consequences will be for all of us. Yet when I look at these very limited proposals, there seems to be a gulf between what is here and what the Government said earlier in the week. This is an opportunity, and it surely should not be missed. Responsible British companies are rightly proud of what they contribute in developing countries. Why should we not now ensure that others, too, meet those standards and that their presence in developing countries, as represented down their supply chain, has the beneficial effects we all wish to see rather than negative effects? I disagree strongly with the noble Baroness, Lady Noakes, that we should not rush into things in the dying days of the Bill. These issues have been debated throughout our proceedings. This is a rare opportunity; this massive Bill has been a very long time in coming, and we should do what we can now. I therefore commend Amendment No. 245D and point out to the Government that there is still a long way to go, to judge by their proposals.