The general election is now over, and Parliament has more time to deal with matters other than Brexit. The spotlight has therefore returned to corporate governance, with The Sunday Times reporting that the FRC is developing a “British version of Sarbanes-Oxley”. It reported that this would “heap more responsibility on to directors, asking them to vouch regularly for the integrity of their financial controls and – if passed into law in the UK – opening the possibility of criminal proceedings against chief executives and finance directors for reporting misleading statements to the market.”
It is often quoted that 80% of businesses affected by a major incident, such as fire, close within 18 months and that 90% of businesses that lose data from a major incident are forced to shut within 2 years. These are quite shocking figures and would no doubt encourage many to ensure that their business continuity and resilience plans are robust. However, when it comes to the issue of fire, the role of a director is far greater than just resilience planning and dealing with the impact on the business. Many directors do not realise that they may be liable as the ‘Responsible Person’ under the Regulatory Reform (Fire Safety) Order 2005 (“The Order”) and what this means for them.
Up to now you’ve been operating as a sole trader. Your business is growing, your contracts are becoming more lucrative, and you want to limit your potential personal liability. You decide it’s time to incorporate a company and join the other 4 million private limited companies on the UK Company Register.
BBC news alerts on our phones seem to be constant these days. There is of course the small issue of Brexit which is keeping journalists occupied. However, the state of the economy also features heavily in the news: large corporate collapses have dominated the headlines in recent times.