With regards to palm oil, we need to act now to stop further destruction of the rain forests in the quest to produce the oil. The situation in Malaysia and Indonesia, where large swathes of forested land are being cleared for palm oil plantations, is simply not sustainable. On the 2nd of May 2006 I hosted a Parliamentary reception on behalf of Friends of the Earth to raise awareness of this issue within Parliament and tabled an EDM on the subject.
To help tackle the problem, I want to encourage companies to state the origin of palm oil used in a product on the packaging in the way that companies working with timber often do, enabling consumers to make an informed choice. I also want to actively encourage UK companies to join the Roundtable on Sustainable Palm Oil (RSPO), a global voluntary partnership between business and NGOs to set standards for sustainable palm oil. The Government should be supporting this initiative and, once an RSPO certification scheme is up and running, commit to procuring only products which use palm oil from a sustainable source.
More generally, sustainable development and company accountability are issues that the Lib Dems take very seriously. We believe that social and environmental issues, far from being tangential, are of fundamental relevance to business and, therefore, any argument that sidelines these issues fails to address the reality for companies operating in a global economy.
For that reason I have strongly supported the campaign to improve the way companies have to report on their environmental and social impacts. On matters such as palm oil and rainforest loss, I believe this type of information will empower everyone, not just shareholders, to show what they think about the ethical practices of companies.
The Lib Dems have been strongly opposing the Government's decision to back down on the more stringent company reporting originally proposed in the form of the "Operating And Financial Review". Chancellor Brown's sudden decision last November to drop this requirement is a real set back, and Lib Dems have led the opposition in Parliament to that U-turn.
Moreover, in the Company Law Reform Bill before Parliament we have supported the proposal of "enlightened shareholder value" which will clarify the responsibility of directors to take environmental and social issues (such as where products like palm oil are sourced), into account when taking decisions which influence the long term benefit of the company and of shareholders.
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