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Mind your business

24 May, 2024

If you think a world where all businesses align their interests with those of wider society and the environment sounds cool, you aren’t alone. Recent research from B Lab UK has shown that 76% of the UK public support the idea of businesses having a legal responsibility to prioritise people and the planet. (Spoiler alert: we at Good Business do too.) 

The research was carried out in support of the Better Business Act (BBA), which proposes amendments to the Companies Act 2006 and which would embed a legal requirement for company directors to consider the interests of all stakeholders, not just shareholders. Currently, directors are permitted to consider other stakeholders when making decisions, but only while pursuing the success of the company for the benefit of the shareholders. The BBA would change this so that in situations where a director must choose between the company’s intention to create positive social or environmental impacts and the interests of shareholders, the directors would no longer be compelled to default to prioritising shareholders. 

The BBA wouldn’t be a silver bullet to a society where success is measured not just in profit, but in positive impact. But it would be a step towards putting stakeholder interests firmly on the board agenda. By expanding the duty of directors to consider a wider array of stakeholders, the BBA could open companies to more varied legal challenges from stakeholders if they feel their interests are neglected. 

If better businesses are an idea you can get behind, the campaigners for the BBA have created a handy page to help you draft a message to your Local MP expressing your support for the adoption of the act. It’s quick, impactful, and a great way to show that you care about a better, fairer business landscape. After all, better businesses are everyone’s business! 

By Louise Podmore

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