Blair promises to crack down on corruption

Tony Blair will tomorrow announce the biggest bid ever to crack down on corruption by multinational firms operating in Third World countries at the Earth summit here.

He will announce a voluntary "Transparency Initiative" at a speech to businesses here tomorrow, under which oil, gas and mining will publish what they pay governments and national authorities in developing countries. But he will also say that, if the initiative does not work, he will legislate to punish offending firms – and might even take measures to stop offending companies being listed on the stock exchange.

The initiative marks an important victories for a coalition of charities, including Save the Children and the Tear Fund, which have been campaigning on the issue for years, and is backed by five key companies: Rio Tinto, Shell, BP, Anglo-American and BHP.

Downing Street is promising to "play a leading role" in following up the initiative. Britain will host an international meeting of governments, companies, pressure groups and the UN to work out the details of how it will operate, but no date has yet been set.

The initiative will greatly increase pressure on leaders here to agree measures to improve the accountability of multinational firms. Development and environmental groups have succeeded in pushing the issue onto the agenda and persuading EU countries to back their proposals for a study of the possibility of imposing binding rules of conduct on companies.

John Hilary, the trade policy adviser at Save the Children, said last night: "We support the initiative, but it can only be a first step. We have grave doubts about making such a voluntary scheme work, and will be pushing hard to make it mandatory."

Meanwhile, the Prime Minister yesterday made his strongest statement on the summit for months, stressing – in a coded rebuke to the United States – that there must be no "backsliding" on what was agreed at the last Earth Summit in Rio 10 years ago and in other environmental agreements. The US has been pressing hard to erode some of the key principles agreed by President's father and other world leaders in Rio.

He added that there must be "key specific deliverables" on sanitation, a clear reference to a target to reduce the number of people without it by half by 2015, which the United States has been strongly resisting.

He said: "It is important that we send out a big signal from the summit that we are going to hold to the positions we have got. There should not be any backsliding.

"The issues are very, very important and they will make a difference to the domestic policies of the countries involved. Britain should be at the very forward end both on development and the environment too." His words appear to mark an increase in the priority that Mr Blair is giving to the summit. For over a year and a half he took the lead among heads of government, being the first to commit to attending.

However he has backed away from leadership in recent months, largely as a result of inaccurate press reports accusing Mr Prescott of taking junkets in his travels to promote the summit, and has come under heavy criticism for deciding to make only a fleeting visit.

But the Deputy Prime Minister has been here for days acting, as he puts it, "as Tony's eyes and ears" and appears to have had some success in persuading him of the importance of the issues at stake.