In June, what had seemed to be a wall of silence from big business on issues concerning regulation, started to show some cracks. At a European parliamentary hearing on transparency in the oil industry in June, BP announced that it preferred a voluntary approach but Shell said it could live with regulation provided it was even-handed and applied to all competitors. 29 Groups like Christian Aid welcomed Shell's new-found enthusiasm for regulation 30 but felt that the patchy response from the sector as a whole showed the need for a global, binding approach, as was suggested by groups led by Friends of the Earth International at WSSD.

Also in June, the UK-based NGO Cornerhouse produced a report alleging that UK's Export Credits Guarantee Department, allows corruption by British business to go unchecked. 31 The report called for international binding rules that place a legal responsibility on governments to take all reasonable steps - through preventative due diligence, and post-issue monitoring procedures - to ensure tax payers' money doesn't underwrite corrupt business deals. This could include an incorporation of 'Publish What You Pay (PWYP)' principles on transparency into an international treaty. An example of how this might work might be provided by the G8 initiated Financial Action Task Force, which in 2002 threatened Nigeria and the Ukraine for failing to take adequate legislative measures to combat money laundering. 32

Enthusiasm for a non-regulated approach to inducing better corporate social and environmental performance was dealt further blows this summer. The United Kingdom is seen as a leader in the corporate citizenship field, with a range of large corporations heavily involved in initiatives such as the Global Compact, a burgeoning industry of corporate responsibility consultants and specialist NGOs, and a growing socially responsible investment sector. However, the government of this 'leading' country, revealed during the summer that only 40 companies had signed up to the 'Make a Corporate Commitment' scheme to publicly disclose environmental information. 33 Groups like Friends of the Earth seized on this to argue that the UK's company law must make good social and environmental behaviour compulsory.

Meanwhile, the UK Company Law Review - that has been going on since John Major was Prime Minister - failed to find parliamentary time for yet another year. However, activists felt a glimmer of opportunity was offered to push a 'corporate accountability' agenda in the Department of Trade and Industry 's proposal that - in line with the Turnball Committee et al's recommendations - companies should consider 'intangible assets of the company.' 34 (Such as the value of the brand and 'reputation' as well as intellectual copyrights and patents; so in theory that could mean things like compulsory social and environmental reporting.)

This will be done through an Operating and Financial Review (OFR.) 35 An OFR Working Group on Materiality has been set up to figure out how this should work, pending the formation of a Standards Body to do it. However, activists criticised the DTI recommendations that leave it up to individual directors to decide what's material to their companies, providing no real prospect of an actual, uniform standard for reporting. (Like companies having to publish an environmental and/ or social report to shareholders.) In June, AccountAbility, released a report, Redefining Materiality: Practice and Public Policy for Effective Corporate Reporting calling for a wider scope to material consideration and disclosure by companies. "Labour standards, human rights and environmental issues rarely figure in investor-focused reporting", commented Simon Zadek, Chief Executive of AccountAbility and co-author of the report, "yet in retrospect we see repeatedly how these issues impact on businesses' reputation, performance and profitability." 36 It remained to be seen whether a standard-less approach could give investors the uniform reporting they would need to assess 'reputational' risks adequately.

From the perspective of international development, a more regulated and thus uniform approach was also argued to be beneficial. A new UNIDO report questioned whether a purely unregulated approach to corporate citizenship was becoming a barrier to trade, locking Southern-domiciled Small to Medium-sized Enterprises out of developing-world markets, supply chains and World Bank loan processes, by creating an unmanageable burden of reporting and verification. 37