In this month's legal updates, experts at law firm Gateley plc explain revised guidance for company directors under amendments to s172 duty of Companies Act 2006, employer liability for data breach by disgruntled employee in Morrisons, oligarchs battle over right of first refusal in United Co Rusal plc and extending personal liability in whistleblowing claims
Guidance for company directors: the s172 duty under Companies Act 2006
Corporate governance has featured heavily in recent months and in the most recent stage of the government’s programme of reforms, the GC100 (representing general counsel and company secretaries working in UK FTSE 100 companies) has published guidance on how company directors can show compliance with their ‘s172 duty’.
Section 172 of the Companies Act 2006 requires directors to act in a way they consider would be most likely to promote the success of the company for the benefit of its shareholders as a whole. ‘Success’ here means long-term value from which shareholders will benefit.
When deciding on the course of action most likely to promote the company’s success, directors must consider various factors relating to stakeholder interests. These include the long-term consequences of a decision, the effect of that decision on both employees and business relationships with customers and suppliers, and wider factors such as the community and the environment.
