The paper "The Companies Act" discusses the act of 2006, that was enacted to bring about most sweeping changes in the law governing the companies and business undertakings in the UK. The law is introduced in stages to give companies the time to fine tune themselves with the proposed changes…
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Not only the shareholders and directors of the companies being freshly incorporated but those of the companies that are already in existence need to study the general duties of the directors in the Act.
Executive Summary: The companies Act in 2006 are a pioneering law contemporary times that places great moral and social responsibility on the directors of the companies. Definitely, UK has taken the lead in calling for a more mature and responsible behavior on part of the Directors of a company. The Companies Act 2006 replaces the companies of 1985 and 1989. The Act, it is hoped, will usher in an era of the more responsible role for people in business leading to “enlightened shareholder approach”. The shareholders will hold the directors more accountable for their acts leading to the generation of awareness for the social and physical environment. The government feels that business atmosphere, society, and the environment are inextricably linked to each other and the positive or negative fallout of one affects the others.
The registration of companies started in 1848. Earlier in the Companies Act of 1948 originated the “True and Fair View” (Bucheery, n.d.). This entailed upon the directors to give a true and fair view of the fiscal position of the company and the profit and loss were reflected in the annual balance sheet for the knowledge of shareholders. Later this system was incorporated in the fourth directive of Company Accounts of the European Economic Commission (Flint, 1982). Earlier the refrain in the corporate world was to maximize profits at any cost. But with the world coming together due to globalization and the experience of negative fallouts of the trade and commerce like emission of greenhouse gases, deforestation, and a yawning gap between the developing and the developed world, a need was felt for enactment of a law that required greater business transparency, a commitment to the social and physical environment and reinforcement of confidence of the people in business systems.
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“The Companies Act Essay Example | Topics and Well Written Essays - 4500 Words”, n.d. https://studentshare.org/business/1541619-see-assignment-criteria-box-for-question.
This objectives and range of activities that can be performed by the company was often defined by the Companies Act 1989 and today effectively removed by the Companies Act 2006 (ultimately implemented from 1st October 2009)2. Earlier, any kind of contract or agreement that was entered with any other party beyond the powers mentioned in the Memorandum of Association was concerned as beyond the powers of the company or an ultra vires provision and hence was declared void ab initio3.
On the other hand, the response of consumers to products and services is differentiated under the influence of changes in market trends, the entrance of new competitors and the developments in technology. Under these terms, the efforts of legislators to establish provisions that can effectively protect the rights of shareholders do not always have the expected results.
The objective of the Companies Act 2006 in general is to implement a lighter regulation on businesses and encourage long-term investment in the United Kingdom (Thomas, 2007). A review of the old company law by Benjamin Hopps of Sykes Anderson law firm found that the law is an over-regulation and has been too complex especially to small companies (Thomas, 2007).
The Company Act is the quintessential code of company law in the United Kingdom. The act of 2006 replaces Propositions of Company Law laid down in the years 1985, 1989, 2004. The new act brings in a number of changes as well. The changes are primarily in the areas such as Company formation, the rights of the shareholders, the liabilities and duties of the directors and the maintenance of share capital.
Every company incorporated by registration under the Companies Act must have a Memorandum and by virtue of Section 1 (1) of the Companies Act 1985 the memorandum must be subscribed by the persons who have the intention to form the organization. These persons are known as 'Subscribers to the Memorandum'.
The Sarbanes-Oxley seeks to bring back the confidence in all publicly held corporations to the shareholders, while placing more responsibility on CEOs and CFOs for the actions of the corporation. "Sarbanes-Oxley is more than just another piece of legislation - it has become synonymous with a new culture of corporate accountability and reform1."
The key research question is to analyze the clauses of SOX act and its implementation problems at US companies. This will be carried out to identify if there are practical limitations to implement the Act as claimed by several US companies and will perform an evaluation of various clauses and terms of the SOX Act.
Co. W.L.L. employs over 2000 employees that belong to 33 different nationalities (“Careers”). I would particularly like to work for this company because the culture of this company fosters, promotes, and encourages
2 Pages(500 words)Research Paper
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