ABSTRACT
This chapter focuses on directors' accountability and in particular, the restoration of personal accountability primarily through law. In the years leading up to 2008, the breakdown in accountability resulted in reckless business decisions in the UK and global credit markets, with catastrophic consequences for the economy. Unconstrained self-interest, irresponsible decision-making and absence of professionalism characterised the behaviour of bankers. Banks such as Northern Rock, RBS and Lehman Brothers suffered massive losses partly due to their executive's failure to understand the exact nature of the derivatives which securitised toxic debt consisting of subprime mortgages. The injection of taxpayer money into failing firms saves their directors from liability and creates a safety net that encourages the types of excessive risks that caused the crunch. The chapter discusses the legal and regulatory ways that hold directors responsible for their actions in the United Kingdom and that are meant to incentivise them to act with care.
