{"id":4577,"date":"2022-08-16T12:44:30","date_gmt":"2022-08-16T11:44:30","guid":{"rendered":"https:\/\/www.goodmanjones.com\/blog\/?p=4577"},"modified":"2022-08-16T12:44:30","modified_gmt":"2022-08-16T11:44:30","slug":"better-business-act","status":"publish","type":"post","link":"https:\/\/www.goodmanjones.com\/blog\/better-business-act\/","title":{"rendered":"What is the Better Business Act?"},"content":{"rendered":"<p><strong><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-4583 alignright\" src=\"https:\/\/www.goodmanjones.com\/blog\/wp-content\/uploads\/2022\/08\/parliament2-300x198.jpg\" alt=\"\" width=\"300\" height=\"198\" srcset=\"https:\/\/www.goodmanjones.com\/blog\/wp-content\/uploads\/2022\/08\/parliament2-300x198.jpg 300w, https:\/\/www.goodmanjones.com\/blog\/wp-content\/uploads\/2022\/08\/parliament2.jpg 526w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/strong>The collapse of several high profile companies, together with an unprecedented series of societal challenges, from the Covid-19 pandemic to the current cost of living crisis, has increased calls for change in the way businesses operate.<\/p>\n<p>From policies aiming to limit carbon emissions to allowing more flexible working, there have been many new initiatives and debates around the way we work and the Better Business Act is one proposal to address some of those issues facing us.<\/p>\n<p>Backed by a coalition of almost 1,200 companies, the <a href=\"https:\/\/betterbusinessact.org\/\">Better Business Act<\/a> is a campaign to amend the Companies Act 2006 to make it a legal obligation for companies to act not only in the interest of shareholders\u2019 profits, but also for their people, the community, and the planet.<\/p>\n<p>\u201cThe Better Business Act will transform the way we do business, so that every single company in the UK, whether big or small, takes ownership of its social and environmental impact.\u201d<\/p>\n<p>The coalition argues that section 172 of the Companies Act is unclear as to a business\u2019s responsibility beyond the \u201cDuty to promote the success of the company\u201d. In its current wording it could be interpreted as justifying ruthless profiteering at the expense of the wellbeing of staff, society, and the environment.<\/p>\n<p>Already signed up are companies such as John Lewis, Virgin and Iceland, and with research carried out by the BBA showing that 76% of UK voters and consumers think business should have a legal responsibility for their wider impact, the pressure on more big companies to follow suit looks likely to grow.<\/p>\n<p>This change to the Companies Act would see all companies required to do something that over 700 businesses have already voluntarily done by them <a href=\"https:\/\/www.goodmanjones.com\/blog\/what-is-a-b-corp\/\">becoming B-Corps;<\/a>\u00a0certified organisations that \u201c\u201cmeet the highest standards of verified social and environment performance, public transparency, and legal accountability to balance profit and purpose\u201d.<\/p>\n<p>&nbsp;<\/p>\n<h2><strong>What would this mean for my business?<\/strong><\/h2>\n<p>The BBA aims to see four key principles reflected in the amended Companies Act.<\/p>\n<p>First, the proposal seeks to <u>align the interests<\/u> of shareholders with wider society, elevating the cause of societal wellbeing to a legal requirement, <em>alongside<\/em> company success. To do this requires the second principle: <u>empowered directors<\/u> with the ability to make holistic assessments and decisions.<\/p>\n<p>Third, the Better Business Act would require this to be a <u>default change<\/u> that applies to all businesses, large and small and, finally, this must be <u>reflected in reporting.<\/u><\/p>\n<p>Therefore, should the Better Business Act be implemented, there would be a noticeable impact on both board-level decision making and strategic reporting. However, despite the act requiring companies to report on \u201chow the company has advanced its stated purpose and in consideration of its key stakeholders, community, and the environment,\u201d established standards of impact assessment do not exist currently.<\/p>\n<p>But having such established standards is not necessarily problematic; after all, assessing impact is something that the charity sector has long been doing, whether through formal impact assessments or via their Annual Report. Perhaps this is an area where the corporate sector can learn from \u201cThe Third Sector\u201d.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The collapse of several high profile companies, together with an unprecedented series of societal challenges, from the Covid-19 pandemic to the current cost of living crisis, has increased calls for change in the way businesses operate. From policies aiming to limit carbon emissions to allowing more flexible working, there have been many new initiatives and[&#8230;] <\/p>\n<div class=\"brown_button\"><a class=\"more-link\" href=\"https:\/\/www.goodmanjones.com\/blog\/better-business-act\/\">Read More<\/a><\/div>\n","protected":false},"author":9,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[15,468,16,11],"tags":[],"class_list":["post-4577","post","type-post","status-publish","format-standard","hentry","category-charities-social-businesses","category-news","category-tax","category-uk-business-entrepreneurs"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>What is the Better Business Act?<\/title>\n<meta name=\"description\" content=\"What is the Better Business Act and what impact would it have on 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