Do The Directors Duties Set Out in the Company Hinder Entrepreneurial Pursuits of the Directors Within Corporations

In the UK the legislator aiming to reduce the risks related to the decisions of corporate directors introduced a series of detailed rules, which should be used as the basis for evaluating the credibility of the corporate directors’ decisions and actions. The examination of these rules led to the assumption that in UK corporate directors are primarily free to use their own perceptions and criteria in developing their corporations’ strategic plans. however, the relevant decisions need to be carefully justified as the consequences in the case of failures or damages are severe – usually, the corporate directors are called to take the responsibility for any failure in the corporate plan – the schemes available for the limitation of this responsibility are limited – for instance, the possibility of ratification of the director’s actions, as explained analytically below. From this point of view, existing UK Company law can be regarded as leading to the reluctance of directors to be entrepreneurial in corporate decision-making.In order to understand the effects of UK company law on the entrepreneurial pursuits of company directors, it would be necessary to explain primarily the role of these individuals in modern corporations – as this role is described in the laws regulating the activities of directors in corporations across the UK. In accordance with the 2006 Companies Act – section 250 – the director is a term referring to ‘any person occupying the position of director’ (s250, in Calder, 2008, p.57). in accordance with Calder (2008) three are the roles within corporations that can be related to the director’s position: ‘the chairman, the chief executive and the company secretary’.