The DTI has published a white paper setting out proposals to modernise and simplify company law.

The government aims to cut red tape and save small business about £170 million with the reforms.

The white paper is the first part of the government's response to the Company Law Review - begun in 1998, and completed last year.

Forum Response: Institute of Directors

George Cox, director general of the IoD, told ePolitix.com: "I am delighted to see that the government has acknowledged the importance of reducing the burdens on small business - this will remove one of the significant obstacles preventing companies from growing and will help improve their competitiveness.

"I also welcome the proposals to bring about some clarification of directors' duties that the primary role of directors should be to promote the success of the company for the benefit of its shareholders as a whole. Again, this is an area where we have been pressing the government to act.

"The Institute of Directors will continue to play its part in the on-going process of achieving a modern framework of company law."

Forum Response: Association of British Insurers

Stephen Sklaroff, deputy director general of the ABI, told ePolitix.com: "While we can welcome much of what we have seen in the white paper, it is also very important that the government makes sure that all the other current reviews of corporate governance fit together into a coherent framework."

Forum Response: Federation of Small Businesses

A spokesman for the FSB told ePolitix.com: "These reforms are long overdue and to be welcomed. We are disappointed that the government has decided not to increase the audit threshold from £1 million to £4.8 million as recommended by the independent review but the simplification of the rules should free up small companies to concentrate on more productive matters."