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New legislation due to come into effect in October will create uncertainties for directors, a report has claimed.
Companies Act Legislation will extensively effect the duties of directors, it said.
Published by the Association of Chartered Certified Accountants (ACCA) and titled A guide to directors responsibilities under the Companies Act 2006, the study looks at how the act will change business decision-making processes.
It also sets out a list of individual offences that a director could be penalised for under the new law.
John Davies, head of business law at ACCA said that the new Act "raises the bar in terms of the levels of skill and care that shareholders are entitled to expect from the directors of their company".
He continued: "Considerations of corporate responsibility are integral to directors’ assessments of what is best for their company.
"These reforms amount to a decisive step forward in the law on directors duties and need to be taken seriously by all who hold appointments or are considering taking them on."
He added that the new rules will apply to directors of companies of all types and sizes, including SMEs.
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