Reply to post: Re: corporate conscience

Raising minimum wage will raise something else: An army of robots taking away folks' jobs

Anonymous Coward
Anonymous Coward

Re: corporate conscience

"We have to legislate for companies to have a social conscience and responsibilities to ALL stakeholders - shareholders, workers, customers, government."

The UK already headed down that legistlative road. Section 172 of the 2006 Companies Act (below) specifically says company Directors must consider the interests of employees, suppliers, community, environment etc, and not just in a short term context either.

Obviously few people are aware of this legislation and even fewer bother about it, maybe because the consequences of ignoring it are nil, but this is The Law as it has been in the UK for a few years.

So, given that legislative action on this subject has clearly not benefited the general public, what other mechanisms besides legislation might be relevant?

From e.g. http://www.legislation.gov.uk/ukpga/2006/46/section/172

172 Duty to promote the success of the company

(1)A director of a company must act in the way he considers, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to—

(a)the likely consequences of any decision in the long term,

(b)the interests of the company's employees,

(c)the need to foster the company's business relationships with suppliers, customers and others,

(d)the impact of the company's operations on the community and the environment,

(e)the desirability of the company maintaining a reputation for high standards of business conduct, and

(f)the need to act fairly as between members of the company.

(2)Where or to the extent that the purposes of the company consist of or include purposes other than the benefit of its members, subsection (1) has effect as if the reference to promoting the success of the company for the benefit of its members were to achieving those purposes.

(3)The duty imposed by this section has effect subject to any enactment or rule of law requiring directors, in certain circumstances, to consider or act in the interests of creditors of the company.

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