Question to the Department for Business, Energy and Industrial Strategy:
To ask Her Majesty's Government what assessment they have made of the relevance of section 172 of the Companies Act 2006 due to changes in business practice since that date.
Section 172 of the Companies Act 2006 requires directors, in promoting the success of their company in the interests of its members, to have regard to a number of matters, including the interests of employees and the impact of the company’s operations on the community and the environment. The legislation is flexible and permissive, allowing companies to identify a purpose for the company other than to benefit its members. Many companies have made successful use of this flexibility.