Greensill director ban highlights the scrutiny directors can face after corporate collapse
The nine-year director disqualification accepted by Lex Greensill is another significant development in the long-running fallout from the collapse of Greensill Group.
While the case is high profile, the underlying issue is a familiar one in insolvency and restructuring. When a company fails, the conduct of its directors in the period before insolvency can come under detailed examination. Decisions taken under financial pressure, particularly where large sums, secured arrangements, insurance-backed obligations or creditor interests are involved, may later be reviewed through the lens of directors’ statutory duties.
In this case, Greensill has agreed to a disqualification undertaking which will prevent him from acting as a company director in the UK for nine years. The undertaking was accepted by the Secretary of State for Business and Trade on 2 June 2026 and is due to take effect on 23 June 2026. Unless he obtains court permission, Greensill will be unable to act as a director or take part in the promotion, formation or management of a company until June 2035.
The undertaking means that a planned six-week trial over his conduct will no longer take place.
Greensill was a director of Greensill Capital (UK) Limited, Greensill Limited and Greensill Capital Pty Limited. The group, which operated in the supply chain finance market, collapsed in 2021. Greensill Capital (UK) entered administration in March 2021 with liabilities of more than £1.6 billion. The Australian parent company entered administration in the same month and later went into liquidation, while Greensill Limited entered liquidation in July 2021.
The disqualification concerns a series of transactions entered into in late 2020. Those transactions related to US construction business Katerra and notes purchased by the Credit Suisse (Lux) Supply Chain Finance Fund.
The notes were linked to Katerra-related receivables and were also supported by trade credit insurance. According to the Insolvency Service, Greensill caused the relevant Greensill companies to enter into transactions which removed legal protections that supported the Credit Suisse fund’s position.
The effect of those transactions, according to the Insolvency Service, was that the receivables no longer had to be paid, security held in relation to them was released, and payment obligations connected to the trade credit insurance were cancelled. The agency also said the transactions were entered into without the necessary written consents.
A further issue concerned $440 million received by Greensill Capital (UK) in November 2020. The Insolvency Service said Greensill caused or allowed that money to be used for purposes other than redeeming notes owed to the Credit Suisse fund. The notes subsequently defaulted when they became due, resulting in a $440 million loss to the fund.
The undertaking was given on the basis that Greensill did not dispute certain facts for the purposes of the disqualification proceedings only. The Insolvency Service said his conduct breached his duty under the Companies Act to exercise reasonable care, skill and diligence as a director.
The case is a reminder that director disqualification is not limited to cases involving fraud or deliberate wrongdoing. Conduct may still be challenged where directors are found to have failed to meet the standards expected of them, particularly where creditors, investors or other stakeholders suffer substantial losses.
The Greensill collapse has already generated extensive litigation, investigations and recovery work. Insolvency Service investigations began in May 2022, with disqualification proceedings issued against Greensill in March 2024. Greensill later attempted to pause part of the claim and also applied to have the whole claim struck out. Those applications were unsuccessful, and the Court of Appeal refused permission to appeal the strike-out decision.
The disqualification also sits alongside continuing recovery efforts within the Greensill estates. Earlier this year, Chris Laverty, Will Stagg and Russell Simpson of Grant Thornton, the joint administrators of Greensill Capital Management, reached a £71 million settlement with former auditor Saffery. That settlement formed part of a wider litigation and asset recovery strategy arising from the group’s failure.
Unsecured claims against Greensill Capital (UK) are still estimated at around $1.6 billion.
For insolvency professionals, lenders, advisers and company directors, the case reinforces an important point. The closer a business gets to financial distress, the more important it becomes for directors to document decisions carefully, take appropriate advice and keep the interests of creditors and stakeholders firmly in view.
Director conduct can remain under scrutiny long after a company enters administration or liquidation.