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Climate Change Bill [HL]

I would like to speak to Amendment No. 184A, to which the noble Lord, Lord Teverson, has given a positive nod. We are using the Companies Act and the European legislation for a business review, and to extend it to ensure consistent and effective reporting of carbon usage by all listed companies. We all know that much of the reduction in carbon is going to have to be achieved by commercial private enterprises. I have heard the noble Lord’s fellow Minister in Defra say that capitalism got us into this mess and it is going to have to be capitalism that gets us out of it. Although Governments play a part and regulation, taxation and support for trading schemes will undoubtedly guide business behaviour, unless carbon is rooted into the central fundamental considerations of business values and objectives, we are not going to achieve the kind of technological changes that will be required to meet the Bill’s tough targets. To get that kind of behaviour change, internally managers and decision-makers in companies have to see the importance of the carbon objective; and externally shareholders, investors and the general public need to see, as part of the company’s reputation, the way in which they are achieving carbon reductions. As a result, the carbon accounting becomes an important part of the reputation and success of those companies. It is also of course useful to the decision-making bodies of government, the Committee on Climate Change and the other agencies involved to have a consistent, effective and mandatory system of reporting by all companies. During the passage of the Companies Act, which, some noble Lords will remember, went on for a considerable time, there was some resistance by the Government and others to such provisions under the business review on the grounds that they would be resisted by business and seen as a burden. I think that things have moved on. At the previous CBI conference, 82 per cent of companies voted for a positive, mandatory system. As the noble Lord has already said, there has been a significant increase, particularly in the larger companies, in reporting. The amendment would make it mandatory and consistent and give a power to the Government to set the standards in consultation with industry on how carbon usage is reported. The Government may not like the terms of the amendment, but the principle of effective, consistent and mandatory carbon reporting ought to be part of the Bill, and a major part of the leverage that we have in achieving carbon reductions in the private sector.