Motion #03
Companies should be required to put environmental and social priorities ahead of financial returns to shareholders.
This will be done by amending the Companies Act and making mandatory the declaration of a purpose in companies’ Articles of Association in line with the amended Companies Act.
EC652 currently reads:
EC652 The right of the shareholders to dividends must not be the single most important criterion for company policy making. Those with a stake in the company’s decisions must have the right to make informed input into those decisions. These ‘stakeholders’ include the share holders, the workers, consumers, the local community and advocates for the local environment. New legal and institutional structures will be created to enable these stakeholders to have a voice in the running of companies and other relevant organisations.
Conference approves the following changes to existing policy EC652 as follows:
After ‘making’, insert: ‘The Companies Act 2006 (section 172) will be amended such that directors of a company must prioritise the well-being of all living entities (including all nations, all species and future generations, as well as all people alive today) and avoid negative environmental and social consequences. This means that companies will need to invest profits in a just transition of their company before distributing dividends to shareholders. Companies will also be required to include a clear purpose in their Articles of Association aligned with this change to the Companies Act.’
After ‘workers’, delete ‘consumers,’.
After ‘local community’, add ‘(where appropriate)’.
Before ‘environment’, delete ‘local’.
Such that it reads:
EC652 The right of the shareholders to dividends must not be the single most important criterion for company policy making. The Companies Act 2006 (section 172) will be amended such that directors of a company must prioritise the well-being of all living entities (including all nations, all species and future generations, as well as all people alive today) and avoid negative environmental and social consequences. This means that companies will need to invest profits in a just transition of their company before distributing dividends to shareholders. Companies will also be required to include a clear purpose in their Articles of Association aligned with this change to the Companies Act. Those with a stake in the company’s decisions must have the right to make informed input into those decisions. These ‘stakeholders’ include the share holders, the workers, the local community (where appropriate) and advocates for the environment. New legal and institutional structures will be created to enable these stakeholders to have a voice in the running of companies and other relevant organisations.
Add after decisions:
‘These stakeholders will be named in company documents.’
Add after organisations:
'Companies must publicly disclose ultimate beneficial owners with significant control.’