Dame Anita is a tireless campaigner

The environmental and human rights campaigner said the honour would drive her on to become even more radical.

Dame Anita quit her role as co-chair of The Body Shop last year to concentrate on campaigning. She still spends much of her time sourcing new products during her travels abroad and working as part of the company's creative team.

She has also found time to sit on BBC News Online's small business panel, offering advice to readers on corporate responsibility and retailing.

Commenting on her honour, Dame Anita said: "It's fantastic to be recognised by your peers and such an honour.

SMALL BUSINESS SERIES Dame Anita Roddick sits on BBC New Online's panel of small business experts E-mail your business questions to Dame Anita Roddick

"I hope it will push me to be even more radical.

"Women in their advancing years are unstoppable and as they become older, they are more radical.

"The honour will mean nothing unless it pushes me on."

Jail campaign

Dame Anita was awarded the OBE in 1988 and has received the latest title for services to retailing, the environment and charity.

She founded the Body Shop 1976 in Brighton, to earn money for her two daughters.

Bill Morris has been knighted for his services to trade unions A profile of Bill Morris

Her environmentally-friendly ideas were ahead of their time and her green cosmetics store soon took off.

She received news of her honour in the "belly of a Louisiana jail", she said, where she is trying to gain the release of two men she believes have been wrongly imprisoned.

"My husband Gordon faxed the notification over to the B&B I was staying in and asked if I wanted to accept it," she said.

"I was shocked but said `Yes' immediately."

She said she planned to use the headline "There's nothing like a dame" on her official website.

Union honour

Elsewhere, Britain's first black trade union leader, Bill Morris, received a knighthood.

The Transport and General Workers Union general secretary said: "This is a great honour, not just for my union, but for the causes I speak out about, including giving a voice to refugees and asylum seekers.

"I hope that in this recognition, today's young black Britons will find some inspiration. I have always held the view that race can be an inspiration, not a barrier."

Sir Bill retires from the TGWU later this year.

Professor Sushantha Kumar Bhattacharyya CBE, director of Warwick University's Manufacturing Group, has been knighted for his services to industry and higher education.

Other business people to be knighted include:

• John Gains, chief executive of construction giant Mowlem
• Michael Hodgkinson, chief executive of airport operator BAA
• Francis Mackay, chairman of caterers Compass Group
• Robin Miller, former chief executive of media group EMAP
• Andrew Crockett of the Bank for International Settlements
• Christopher John O'Donnell, chief executive of Smith & Nephew.