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Policy & Legislation – UK


CSR is about how companies exceed the minimum legal compliances to integrate socially responsible behaviour into their core values. As there are infinite businesses present in industries throughout the UK today, and the challenges and obstacles faced differ substantially, Government interventions must be carefully considered, well-designed and targeted to achieve their objective.

The Government are creating incentives to encourage the adoption and reporting of CSR through best practice guidance, and, where suitable, appropriate regulation and financial incentives.

Pensions Act Amendment

This legislation rendered effective in July 2001 and necessitates trustees of occupational pension schemes to affirm their policy regarding the extent to which social, ethical or environmental issues are considered in the selection, retention and realization of investments.


UK businesses are regularly at the top end of surveys carried out in regards to CSR reporting: In the Global Reporters Survey. UK companies were rated within the top 3 reporters and over 80% of FTSE 100 businesses report on environmental and social matters.

The Government urges reporting of CSR performances of UK companies in numerous methods:

·        Submitted guidance on environmental reporting

·        Supported proposals promoting business reporting containing the Forge I and II guidance for the financial services sector and the ACCA sustainability reporting awards

·        Supported the Global Reporting Initiative

·        The improved business review specifications of the Companies Act

Companies Act 2006

The Companies Act 2006 brings the regulatory framework up to date to reflect the modern workplace. It protects the concept of Enlightened Shareholder value which recognises that directors are more likely to obtain long term sustainable success for the gain of shareholders if their companies identify and action appropriately to wider issues e.g. the environment and their employees.

Every registered company, other then small businesses must provide a Business Review as part of the director's annual report. October 2007 also necessitated quoted companies prepare – to the extent necessary for an overview of the company's business – release information on employee, environmental, community and social matters, also on contractual and other arrangements vital to business. The Government believes this will promote real value to the eminence of narrative reporting and encourage responsible business behaviour, without imposing undue burdens on business.

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