CJC welcomes new PM and explains why new corporate accountability laws should be part of Labour’s strategy.

Yesterday, Monday 20 July, Andy Burnham was sworn in as the new Prime Minister of the UK. Read below the letter CJC and our partners sent to welcome him into office. In it, we explain why action to protect people and the planet from corporate harm aligns with his inentions to a.) Return to Labour’s core values, b.) help restore people’s confidence in this government and c.) end the accountability defecit.

Dear Prime Minister,

We, the  undersigned partner organisations of the Corporate Justice Coalition, the UK’s leading network on corporate accountability, wish to congratulate you on your Premiership.

In a difficult prevailing context, the Labour government has taken important steps to improve lives. We welcome the advances in workers’ rights, protections for renters, and investments in clean energy and energy security through Great British Energy. Yet as you have rightly noted, you have inherited a system facing multiple challenges – and the status quo is failing too many in the UK, and beyond our borders. 

The UK risks falling far behind and out of alignment with other EU and OECD nations in addressing the main drivers of environmental degradation, and human and labour rights abuses. Currently, regulatory gaps enable UK businesses and the public sector to abuse human rights and the environment in their value chains without consequences. Unscrupulous businesses can profit from harm, while British businesses who do the right thing are undercut. Meanwhile, victims of corporate harm, at home or overseas, face a near impossible battle for justice.

Your government has the opportunity to change this. Work is underway in DBT to review the UK’s approach to Responsible Business Conduct (RBC) and to consider mandatory human rights and environmental due diligence legislation, following the Trade Strategy’s recognition of the harms perpetuated in UK private and public sector supply chains. 

We urge you to move beyond review and take action to adopt a Business, Human Rights and Environment Act (BHREA) in the UK – a mandatory human rights and environmental due diligence (mHREDD) law which would use the British ‘failure to prevent’ clause to incentivise the prevention of harm by companies and the public sector, and facilitate easier access to justice for victims of harm.

Mandatory human rights and environmental due diligence would support you to achieve many of your stated objectives, and those of your party, in the following ways:

1.     Building on Labour’s core values

A Business, Human Rights and Environment Act sits firmly within Labour’s key traditions of social justice, equality and opportunity. It would support workers’ rights, including decent work, domestically and internationally, and would promote better outcomes, opportunities and sustainable growth for responsible British businesses across the nation.

2.   Restoring people’s confidence in our government

We commend your stated desire to regulate where necessary, rather than leaving everything to market forces. Sustainable growth relies on robust legislation which addresses systemic power imbalances, and responds to public demands. Four in five UK adults want new corporate accountability laws, and 145,000 people have signed a petition calling for the Government to act. New due diligence laws have been called for by businesses and investors, more than 80 Parliamentarians, the Independent Anti-Slavery Commissioner, the British Retail Consortium, and multiple parliamentary committees. Enacting the legislation called for by these diverse groups would restore the public’s confidence in the capacity of the government to uphold the public’s values and interests and respond to their wishes. 

3.     Ending the accountability deficit

A long list of scandals and tragedies mark the UK’s history. Typically, accountability, justice and redress remain elusive despite the tireless efforts of campaigners. From Horizon to Grenfell to water pollution, the UK’s accountability void fails victims and erodes public trust in our institutions. This gap must urgently be closed, among other things through the introduction of robust legislation which mandates the prevention of harm in public and commercial operations and value chains, and ensures effective routes to justice when people’s rights are violated. You have spoken about the centralisation of political power in the UK – this is mirrored by the centralisation of corporate power which operates to the detriment of people, workers and communities. Addressing corporate impunity would reset this power imbalance, handing control back to those harmed by corporations in the UK, or by British corporations operating abroad.

As signatories who are members of the leading UK coalition on corporate accountability, we stand ready to work with your Government to continue the work underway in DBT’s review of Responsible Business Conduct, and address human rights abuses and environmental harms in global value chains.

Yours faithfully,

Eleanor Rosenbach, Co-Director, Corporate Justice Coalition, and the undersigned: