Government slammed for failure to control British business overseas

A trio of internationally respected charities have joined forces to question the Government's record on regulated home-grown businesses beyond Britain's borders.

Amnesty International, Christian Aid and Friends of the Earth have created a joint report claiming people in developing countries are exposed to human rights abuses, environmental degradation and economic loss because the UK Government is failing to effectively implement its flagship CSR scheme for corporate behaviour overseas.

Flagship or failure? argues that despite vaunting the importance of the OECD Guidelines for Multinational Enterprises, which set out responsible principles for business, the UK Government has done little to enforce these standards.

The report says there appears to be a reluctance on the Government's behalf to adequately investigate complaints made under the guidelines and an unwillingness to declare companies in breach of them.

Despite numerous complaints about company behaviour and clear evidence to the contrary, the UK Government has yet to find a single UK company in violation of the guidelines.

For example, in 2002, a UN report accused companies of profiteering from the exploitation of natural resources and of contributing to human rights abuses during the armed conflict in the Democratic Republic of Congo.

Eighteen British-based companies appeared on the UN's list.

But although official complaints were made the Government did not find any of them guilty of breaching the OECD code of ethics.

Tom Fyansm, a spokesman for Amnesty International UK, said: "The UK Government has been playing to the gallery - championing the OECD guidelines as a flagship initiative for encouraging good corporate practice, while it lacks the political will to enforce them.

"Initiatives of this kind can only work if there is a clear incentive for companies to implement good practice, and sanctions if they don't.

"The Government must be seen to be enforcing these guidelines if they are to be worth the paper they are written on."

The Government has made much of the importance of voluntary standards for improving company behaviour, denying the need for a tighter regulatory framework.

But evidence in the report suggests that this strategy is failing developing countries because of UK company abuses overseas.

Mr Fyans added: "The Government needs to get it's own house in order.

"Alleged breaches of the guidelines must be fully investigated, transparency must be improved, and the NCP's Final Statements must include clear recommendations for improving company behaviour in the future.

"Without these improvements, the guidelines will continue to lack creditability and become completely redundant."

The three charities which published the report are calling for statutory obligations to replace voluntary guidelines and for those guidelines which do exist to be more effectively enforced.

By Sam Bond



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