Company Law Reform, progress at last, says IoD

3 November 2005

Company law reform took a welcome step forward today, the Institute of Directors (IoD), said. With the publication of a Government Bill to amend incongruous and time-consuming legislation, the IoD said small companies especially would benefit from the exercise.

The IoD said it was please the Company Law Reform Bill would exempt small firms from accounting and auditing regulations that should not apply to them.

Miles Templeman, Director General of the IoD, said:

"The publication of today's Bill has been a long time coming. We now have workable legislation in modern English that takes a bottom up approach to company law, providing as it does, separate provisions for small companies."

On the contentious issue of the Bill allowing civil litigation against directors by shareholders, the IoD said it welcomed the move. Shareholders who suffer from the negligent actions of executives should have the right to pursue the individual for compensation. The IoD said it supported the high standards of conduct of executives at all times. 

The possible introduction in the future of secondary legislation on the back of the Bill, was a cause for concern though, the IoD said.

Miles Templeman, said:

"We do not want to see the good work of this Bill undone at some future date by the introduction of secondary legislation. We are happy with this Bill as it stands."