Link bonuses with charity work, say Tories

The Tories want to compel companies to link directors' bonuses with their charity work rather than profits.

Shops that move chocolate bars away from check-outs to stop children pestering their parents to buy them or television stations which do not screen graphic material until late at night are examples of firms which would not face penalties under the scheme.

David Cameron will today unveil plans to encourage corporate responsibility in areas ranging from obesity to climate change. Among the more radical proposals is a suggestion that companies could be judged against each other, with the Financial Services Authority issuing an annual social responsibility index.

Shareholders in companies found to have failed to put the good of the community above that of profit margins would be encouraged to dock annual bonuses from senior managers.

Although the Tories insist that the measures will be voluntary, Mr Cameron has said he would be prepared as a "last resort" to introduce legislation forcing companies to consider the social implications of their decisions.

He will unveil the first in a series of "responsibility deals" - a voluntary agreement with supermarkets and other companies to limit packaging and other waste - to be overseen by the former shadow minister and Asda chief executive, Archie Norman.

David Frost, the director general of the British Chambers of Commerce, said: "Most companies already take on a vast amount of social responsibility and we get very worried when businesses are lambasted for not doing more."

A spokesman for the CBI added: "Very many businesses already do a great deal in the area of social responsibility."