The public enforcement of directors' duties: a normative inquiry

The general duties owed by directors to their companies are
a critical element of company law overall, and corporate governance in
particular. If these duties are breached, the board, acting on behalf of
the company, is empowered to decide whether to take action against
the miscreant directors. If no action is taken then shareholders are
permitted to initiate private derivative actions against the directors
on behalf of the company. This might be seen as the primary private
enforcement mechanism used in the UK when directors commit
breaches. But there have been relatively few actions commenced by
shareholders, probably because of the many disincentives that exist
for them. Given this state of affairs, this paper examines whether
there is a need for the public enforcement of duties by some authority
so that there is an enhancement of corporate governance in the UK.