Many organisations recognise the benefits of operating their activities responsibly, but did you know if you are a director of an incorporated entity under the Companies Act 2006, such as a limited company, you actually have an obligation to consider the community and environment?
Section 172 of The Companies Act 2006
Section 172 of The Companies Act 2006 sets out a director’s duty to promote the success of the company, and while it includes obvious commitments such as considering consequences of decisions in the long term and acting in the best interests of the employees; it also includes:
“The impact of the company’s operations on the community and the environment”
What Can You Do?
The first place to start is considering the impacts your business activity has on your community and the environment. This can be both negative and positive.
If you have implemented an Environmental Management System to ISO 14001, you will have already considered the environmental aspects of your business, and this can easily be extended to include other impacts you may have on your local community or society in general.
Direct impacts are often the most obvious and the most pressing, but also try and consider the indirect impacts you might have, for example within your supply chain.
Recent legislation, such as the Modern Slavery Act, are encouraging organisations to take a wider view to tackle exploitative practices in all parts of the supply chain.
Larger organisations may benefit from basing the Corporate Social Responsibility Programmes (CSR) on established frameworks, such as ISO 26000, guidance on Social Responsibility.
The standard defines 7 core subjects for social responsibility which are interdependent:
6.2 Organisational Governance
6.3 Human Rights
6.4 Labour Practices
6.5 The Environment
6.6 Fair Operating Practices
6.7 Consumer Issues
6.8 Community Involvement and Development
Giving Back and Offsetting
If after considering your organisation’s aspects, you can’t do any more to reduce it’s negative impacts, you can start to look at maximising the positive effects you can achieve.
Here are three ways you can do good:
- Promoting Good Practices to Customers, Suppliers and other Interested Parties.
- Giving back by donating time and/or money to good causes, both locally and nationally.
- Offsetting your carbon footprint through schemes such as the Woodland Trust.
Risk Management, Resilience and Sustainability
Let Assent help your organisations implement a Corporate Social Responsibility Programme and achieve measurable results. Contact Us for more information.