UK: Government consultation - insolvency and corporate governance

The Government has published a consultation paper titled Insolvency and corporate governance: see here (pdf). The paper contains proposals the aim of which, to quote the Government, is to "reduce the risk of major company failures occurring through shortcomings of governance or stewardship, and to strength the responsibilities of directors of firms when they are in or approaching insolvency" (p. 5).

Amongst the proposals contained in the paper is one designed to better hold parent company directors to account in respect of the sale of an insolvent subsidiary that has an adverse impact on the interests of the subsidiary's creditors. And, amongst the questions asked, is this one: are stronger governance and transparency measures required in relation to the oversight and control of complex group structures?  The paper also asks: what more could be done through a revised Stewardship Code or other means to promote more engaged stewardship of UK companies by their investors, including the active monitoring of risk? It also seeks views on this question: whether some directors are obtaining and using professional advice without a proper awareness of their duties as directors, and in particular the requirement to exercise independent judgement.