More penalties for errant directors
Business secretary Vince Cable has tabled new rules that will see company directors face tougher penalties for breaking the law. Under Cable’s plans, directors convicted of offences overseas would be banned from running UK companies, and ministers could ask courts to make disqualified directors pay compensation.
In addition, judges may be put under a duty to consider factors, such as previous business failures and overseas conduct, when they assess whether to disqualify an executive. It was also unclear whether compensation would go to ‘victims who make a fuss’ or to all creditors. Legislation to enact the changes is expected to be brought forward in the next parliamentary session.
The number of director disqualifications fell from 1,437 in 2010–11 to 1,031 in 2012–13 and Cable did acknowledge that the vast majority of directors in the UK ran their businesses in the right way…
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