What alternative action may the Secretary of State take instead of issuing a disqualification order?

Accepting an undertaking from the director to refrain from acting is a viable alternative action that the Secretary of State may take instead of issuing a disqualification order. This option serves as a preventive measure, allowing the director to acknowledge their conduct and agree formally to refrain from any further actions that would lead to misconduct or risk to the company's integrity.

This approach can be advantageous as it allows for a resolution that maintains the director's ability to contribute positively to the business while ensuring compliance with legal and ethical standards. It is less punitive and promotes a collaborative resolution, contrasting with more severe actions like disqualification or financial penalties, which might significantly disrupt the director's career and the company’s operations.

In contrast, filing a lawsuit introduces a formal legal proceeding that can be lengthy and may not achieve the desired compliance outcome as quickly or effectively. Imposing a financial penalty carries its own set of implications and may not ensure that the director refrains from problematic behavior. Removing a director from the company register is an extreme measure that effectively ends their relationship with the company, which could have broader negative consequences for the organization and its stakeholders.