For Fair Tax Week 2023, I took part in a webinar to discuss why it’s important to consider tax when thinking more broadly about being a responsible business.
I’ll start by saying I’m not a tax expert – this webinar was much more about what sustainability and ESG (environmental, social, governance) mean for a business and why it’s important to think about how a company behaves when it comes to its role in society. And our role in society is clear – we’re part of the infrastructure and our products contribute to our cities and towns. So investing in those cities and towns is crucial and that starts with paying our fair share of tax.
For years, global communications firm Edelman has been publishing trust barometer reports based on their research on trust in different institutions such as government and business. One of their 2022 Trust Barometer reports showed that in general, business is trusted to do what is right – 62% of respondents agreed with this, compared with NGOs (59%), government (56%) and media (52%). Their 2023 Global Report stated that business is still the only trusted institution. So as a business, we have a lot to live up to.
I’m proud to say that Marshalls has been accredited with the Fair Tax Mark since 2015. Having this accreditation means we pay the right amount of tax, at the right time, in the right place. We’re committed to transparency and having the Fair Tax Mark tells our stakeholders that we’re serious about being a responsible business.
Getting accreditation from the Fair Tax Foundation is not easy. It all starts with our annual financial accounts which are approved by external auditors. The accounts are then passed on to the Fair Tax Foundation who check that everything is in line with their expectations and accreditation criteria. It’s a rigorous process which is aligned to our overall disclosure and reporting strategy.
We disclose more than is legally required – because it’s the right thing to do. But the ESG disclosure landscape is changing and there are some interesting developments. A new term has emerged called ‘greenhushing’ – when a business under-reports or hides its sustainability credentials in order to evade investor scrutiny. This is completely at odds with the push for more disclosure from various bodies around the world – the CSRD (Corporate Sustainability Reporting Directive) in the EU is now mandating companies to disclose their sustainability data and the ISSB (International Sustainability Standards Board) is pushing for a more level playing field for corporates disclosing their ESG credentials for investors.
It’s interesting to note that ESG ratings agencies – companies who rate corporate sustainability performance for investors – don’t yet highly rate responsible tax conduct. But surely a company that pays exactly what it should, in the country where it operates and in a timely manner demonstrates responsible corporate behaviour? Let’s hope that moving forward ratings agencies will value this appropriately. And in the meantime, we’ll continue to do what we’ve always done, in line with Fair Tax standards.
