Loans to Company Directors A Legal and Ethical Framework
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In the business world, loans to directors are a sensitive issue governed by strict legal scrutiny. Section 185 of the Companies Act, 2013, regulates such transactions, ensuring companies don't misuse funds or enable conflicts of interest. Any loan, guarantee, or security offered to directors or their related entities is closely monitored to prevent abuse of power. While the law initially imposed a complete prohibition, later amendments introduced exceptionsu2014especially for private companiesu2014allowing some flexibility while preserving accountability.
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Loans to Company Directors A Legal and Ethical Framework
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