Directors deliver - just not very much: further reflections on section 172 of the Companies Act 2006

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Abstract

16 years on from the Companies Act 2006, s.172 still has not managed to change corporate culture for the better in the way its promoters hoped. Its fundamental flaw is that only the members collectively can insist on directors improving their behaviour. If the members are the directors, or don't care, there is little that can be done. Other countries have exactly the same problem. S.172 is aspirational and does no harm, but any country thinking of adopting similar wording should have low expectations of significant change to corporate culture.
Original languageEnglish
Pages (from-to)212-221
Number of pages10
JournalJuridical Review
Volume2022
Issue number4
Early online date16 Dec 2022
Publication statusPublished - 16 Dec 2022

Keywords

  • Company law
  • Corporate culture
  • Companies Act 2006 s.172
  • Directors
  • Derivative claim
  • Canada
  • Enlightened shareholder value
  • Insolvency
  • Breach of directors' duties
  • Corporate scandals

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