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Lord Taylor of Holbeach: Many of the amendments proposed by the Opposition in Committee so far have dealt with the transparency of government actions and decisions on climate change. We have felt that we
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At present, there is no consensus on methodologies for measuring the carbon footprint of companies services, supply chains, products or general operations. Thus, although in principle we welcome the amendment, we cannot offer our support until more work is done towards establishing national and international consensus on how companies measure and report their emissions footprint. It is only through such practice that useful comparison will be enabled, providing customers with a genuine way of discerning between different choices in the market.
My honourable friend Peter Ainsworth, in another place, has called for the Royal Society to take forward the process of establishing a mechanism for achieving consensus. Until that is done and until another adequate way is agreed in calling for mandatory disclosure of carbon usage, we will not achieve the laudable intentions behind the amendment.
The primary objective of company reporting is to provide information for shareholders and investors. The Government want to encourage full and transparent corporate reporting. For that reason the House agreed the provisions of the Companies Act 2006 on the business review. They require directors of listed companies to include in their reports information on environmental matters, including the impact of the companys business on the environment. The business reviews of these companies must also include key performance indicators on environmental matters where necessary to understand the business.
As the Committee knows, the new provisions came into force only on 1 October last year for financial years beginning on or after that date, and company reports under this new regime will not be published until late 2008 or early 2009. Obviously, we expect many companies to include information about climate change and other environmental issues in their reports. Although I support the intention of the amendment, I would be concerned that introducing provisions to require disclosure of greenhouse gas emissions would pre-empt the outcome of the narrative and reporting provisions of the Companies Act 2006.
The arguments for and against the introduction of statutory standards were considered by BERRthe DTI, as far as I am concernedas part of its consultations on the Companies Act. We think that we now have the right balance, as the debates in this House and the
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Lord Teverson: I thank the Minister for his reply. I understand the question of timescale, but perhaps we could find a reasonable timescale within which standards need to be agreed. This has to happen; business itself thinks that it needs to happen. I am slightly disappointed by the response of the noble Lord, Lord Taylor, but there may be ways round the issues that he raised. At this stage, I beg leave to withdraw the amendment.
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