July 15 - Proposals to make negligent directors personally liable for repaying failed companies debts are to be included in a sweeping shake-up of UK corporate law. As Hayley Platt reports it's the latest move to tackle corporate excess in Britain
First it was banks, then tax avoiders - now the UK government has a new target - directors of failed companies. Britain's Business Secretary plans to shake up corporate governance rules. Vince Cable wants disgraced bankers punished and 'errant' company directors disqualified. They might even be forced to repay their company's debts from their own pocket. SOUNDBITE: Vince Cable, UK Business Secretary, saying (English): "Where cases of corporate abuse and improper and unfit management are uncovered they've got to be tackled in a robust and timely fashion and knowing that we have an effective system for identifying and dealing with misconduct is essential to creating an atmosphere in which honest entrepreneurs are will to invest because they're not at a disadvantage in relation to those who flaunt the rules." The government's Trust & Transparency report is designed to restore confidence. Directors of failed companies will be disqualified for 5 years instead of three. Companies will no longer be able to conceal the identity of those who run it. And directors who've failed abroad won't be able to start again in the UK. SOUNDBITE: Vince Cable, UK Business Secretary, saying (English): "Under the reforms we're now thinking about it would be easier to disqualify directors from operating in business again if they have committed serious reckless behaviour which has harmed other people at the moment there's just one size fits all kinds of companies from the biggest bank to the local builder and will all be dealt with in the same way and that isn't sensible." But some legal experts don't believe the reforms go far enough. Mayer Brown's David Allen. SOUNDBITE: David Allen, International Law firm Mayer Brown, saying (English): "I don't think it will radically change the position I think the real issue actually is one of enforcement again that's fleetingly referred to in the paper but actually if there was sufficient resource and capability to enforce the current laws that might be a lot better than introducing some, at least for the most part, tinkering." There won't be any retrospective punishment for ex RBS boss Fred Goodwin - he was criticised over his role in the bank's near collapse in 2008. But the government hopes the new measures will help stamp out reckless behaviour in the future. That's something that's particularly tarnished the UK's all important banking industry for many years.