Environment and Health & Safety Digest, Autumn 2006

At the time of going to press, the final text of the Act was not available. However, on the basis of the contents of earlier versions of the Companies Bill, the Act introduces a new statutory statement of directors' duties. As before, directors are required to act in the way that they consider would be the most likely to promote the success of the company. However, the revised statement specifically requires that, in doing so, they must have regard to six specified factors, one of which is "the impact of the company's operations on the community and the environment".

There is no formal guidance available as to how directors should go about balancing environmental impacts against most companies’ overriding purpose of serving their shareholders and making a profit.