Directors (Public Companies).

Oral Answers to Questions — Inter-Allied Debts. – in the House of Commons on 12th December 1922.

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Photo of Sir Albert Bennett Sir Albert Bennett , Mansfield


asked the Prime Minister whether, in view of recent disclosures, the Government will consider the desirability of strengthening the law as regards the responsibility of directors of public companies?

Photo of Major Frederick Kelley Major Frederick Kelley , Rotherham


asked the President of the Board of Trade whether he will consider the advisability of introducing legislation next year to diminish the opportunities which the present law allows for the misapplication of funds of public companies by directors of those companies, and also to provide effective penalties for negligence on the part of directors who, by failure to carry out their duties to the shareholders, allow such frauds to go undetected?

Photo of Viscount  Wolmer Viscount Wolmer , Aldershot

I have been asked to reply. The question of the responsibility of company directors was considered by a Company Law Amendment Committee which reported in 1906 and did not recommend any alteration of the law such as is suggested. The President of the Board of Trade is not at present satisfied that any amendment is necessary.