Energy Giant Fined for Under-reporting Carbon Emissions
Corporate Responsibility and Sustainability, Health, Safety and Environment
BBC News reports that ExxonMobil has been fined £2.8 million for failing to report carbon dioxide emissions from its Mosmorran chemical plant in Fife, although the Scottish Environment Protection Agency (SEPA) said “there had been no direct environmental impact”. Reportedly, in its 2008 report to SEPA, the energy giant failed to account for 33,000 tonnes of carbon dioxide. The fine is reportedly a “mandatory consequence of breaching the [European Union] emissions trading scheme”. An ExxonMobil spokesperson reportedly stated that the errors were identified by the company’s internal system and were “immediately reported to [SEPA]“.
BBC News: ExxonMobil fined ‘record’ £2.8m over carbon dioxide emissions (19 February 2012)
(Source: BBC News)
Energy Firms to Cut Prices or Face Inquiry
Competition, Consumer Protection
The Independent reports that the Big Six energy firms, EDF, E.on, British Gas, Scottish and Southern, Scottish Power and Npower will have to revise their “confusing and expensive tariffs” to escape tough action by energy regulator Ofgem. Reportedly, bills have doubled since 2005 to £1,250 a year, leaving 5.5 million households in “fuel poverty”, spending 10% or more of their income on power. A cap on bills could reportedly be introduced amid concerns that “suppliers are keeping bills artificially high”. EDF is currently being investigated for poor customer service and mis-selling, reports The Independent. Reportedly, Ofgem is forcing the Big Six companies “to set uniform standard charges to allow consumers to compare raw costs, or unit prices, more easily” and simplify tariffs into two types – standard and innovative. Should companies not agree to reforms, expected to be announced in July 2012, a UK Competition Commission inquiry is likely to follow, reports The Independent.
The Independent: Energy watchdog tells big firms: cut prices or else (17 February 2012)
(Source: The Independent)
Supermarkets Review Involvement in Work Placement Scheme
Employment and Workplace Issues
The Guardian reports that supermarket chain Tesco would continue to participate in the UK Government’s controversial work experience scheme, although the company would “offer jobseekers a choice of remaining on benefits or taking up paid work with a guarantee of a staff job at the end of the four-week placement if the trial was successful”. Tesco reportedly faced criticism for its participation in the scheme, under which jobseekers who left the program during the first week faced a penalty of two weeks’ jobseekers allowance. A Tesco spokesperson reportedly stated that its negotiations with the UK Government about the Tesco proposal to offer more paid positions had been constructive. According to the Guardian, rival chains Argos and Superdrug had suspended their involvement in the scheme, with Argos stating that it wanted to “ensure the scheme is voluntary … [and] no one is disadvantaged by working on this programme”.
The Guardian: Work experience scheme in disarray as Tesco and other retailers change tack (21 February 2012)
Related news items:
The Guardian: Chris Grayling defends work experience scheme from ‘negative headlines’ (20 February 2012)
The Huffington Post: Tesco Offer To Pay Work Experience, Call On Government To End Benefit Withdrawal Threat Of Scheme Criticised As ‘Slave Labour’ (21 February 2012)
The Independent: Tesco in work experience pay offer (21 February 2012)
(Source: The Guardian; The Huffington Post; The Independent)
FSA Report Questioned for Missing Board Members
Business Ethics and Corporate Culture
The Guardian reports that the UK Financial Services Authority’s (FSA) report into the October 2008 £45 billion taxpayer rescue of the Royal Bank of Scotland (RBS) failed to question seven of 17 board members. Although the RBS board was reportedly not directly blamed for the company’s poor performance, the FSA report raised concerns about former RBS chief executive Fred Goodwin’s “assertive and robust management style”, and an acquisition of ABN Amro as a “gamble”. The FSA reportedly clarified that it took a “targeted approach” to selecting participants for its report, which concluded that no further action would be taken against the bank following a 17-month investigation.
Further information from the FSA
The Guardian: FSA failed to interview key RBS board members for controversial report (23 February 2012)
Bonuses under fire
In related news, the Guardian reports that RBS chairperson Sir Philip Hampton has defended the company’s decision to pay £785 million in bonuses even though RBS recorded a £2 billion loss. Sir Philip reportedly stated that RBS needed to keep being run on “commercial grounds” to restore profitability. RBS has reportedly provided data which shows bonuses were down overall, but union officials criticised the 1% salary rises offered to branch staff who were excluded from a £390 million investment banking bonus pool.
The Guardian: RBS chairman makes plea as £2bn loss is announced (23 February 2012)
(Source: The Guardian; FSA)
Firm Fined for Not Clarifying FSCS Cover
The UK Financial Services Authority (FSA) reports that it has fined Santander £1.5 million for its failure to confirm under which circumstances its structured products would be covered by the Financial Services Compensation Scheme (FSCS). According to the FSA, Santander sold almost £2.7 billion of structured products, including £1.2 billion after June 2009 when it concluded that the circumstances in which its two products, Guaranteed Capital Plus and the Guaranteed Growth Plan, would be covered by the FSCS were limited. Customers were only notified of the limitations of the FSCS cover in January 2010. Santander admitted that it could have “changed its product literature and training materials more quickly to reflect the FSCS position accurately” and has conducted a customer contact exercise relating to all its structured product sales between 1 October 2008 and 6 January 2010, the period during which the breaches occurred.
FSA’s media release (20 February 2012)