Corporate Law
Corporate law encompasses the legal rules and regulations that govern the formation, operation, and dissolution of corporations. It covers a wide range of issues, including corporate governance, compliance, mergers and acquisitions, and shareholder rights. Corporate law aims to provide a framework for the functioning of businesses and ensure accountability and transparency in corporate activities.
8 Key excerpts on "Corporate Law"
eBook - ePub- Roman Tomasic, Roman Tomasic(Authors)
- 2016(Publication Date)
- Routledge(Publisher)
...Introduction Corporate Law in transition Roman Tomasic Corporate Law has developed considerably as a field of law and practice since the Corporate Law statutes of the early nineteenth century. There has also been an explosion in the range of Corporate Law scholarship; this development has often drawn upon other traditions, such as history, economics, politics and sociology. This volume seeks to provide an understanding of a range of contemporary intellectual concerns that has preoccupied Corporate Law scholars. Not only has it sought to encourage the use of comparative law methods in the analysis of Corporate Law issues, but it has also sought to move away from a narrow Anglo–American focus and discuss global developments in this field. This is important as the nature and meaning of Corporate Law will be affected by local political and social factors. As a result, it is a field that is likely to develop further by drawing upon other areas of law and cultural traditions. In its present form, Corporate Law has become a relatively extensive area of law covering core company law principles and extending to corporate finance, takeovers, corporate securities law and corporate insolvency law; it also extends further to cover areas of soft law such as principles of corporate governance and even corporate social responsibility. As Corporate Law ideas have expanded globally, similar company law principles and statutes can be found in many countries, especially in those that are more involved in international trade and commerce. This has been paralleled by a movement towards the globalisation of large corporations and the emergence of transnational corporate groups, presenting a challenge for state-based Corporate Law systems and their regulation (see Blumberg 1996; Hadden 2012; de Jonge 2011)...
eBook - ePubLegal Approaches and Corporate Social Responsibility
Towards a Llewellyn's Law-Jobs Approach
- Adaeze Okoye(Author)
- 2016(Publication Date)
- Routledge(Publisher)
...5 Why not Corporate Law? Different theoretical conceptions of the company have been intimately embroiled in the effort of company law to justify the vesting of substantial power in corporate management. 1 5.1 Introduction Corporate Law as the law of corporations is often seen as the natural home for addressing questions about the relationship between law and CSR. This is why some scholars advocate having CSR issues integrated into this basic state legal framework, thus creating an identifiable framework from which CSR initiatives would flow. Ward puts it thus: The argument here would be that sustainable development (and/or other values associated with CSR) should be integrated within the basic legal framework, governing the formation and functioning of business enterprises – not exclusively as an ‘add-on’ in the form of environmental, labour or anti-corruption legislation – to name a few examples. 2 Frynas also suggests that: Policy makers should make a concerted effort to re-write company law and other regulatory instruments to increase the power of ‘non-traditional stakeholders’ and to require companies to become more transparent about all of their activities. Corporate governance reforms will help companies to make better social and environmental choices in front of shareholders. 3 Furthermore Corporate Law represents a peculiar platform because it is the identifiable state legal framework that is common to most states in the world. 4 This chapter examines Corporate Law’s potential to drive this wider CSR agenda within Corporate Law. It demonstrates that whereas Corporate Law as a substantive body of law can handle the issue of corporate legitimacy relevant to CSR, it only chooses to partially address this issue...
eBook - ePubThe Institutional Theory of the Firm
Embedded Autonomy
- Alexander Styhre(Author)
- 2019(Publication Date)
- Routledge(Publisher)
...Unless Corporate Law provides a legal framework that effectively establishes “rules of the games” accepted (or at least tolerated) by business promoters and other participants, its social and economic benefits are reduced. In an historical perspective, Corporate Law has been one of the most influential legal inventions, conducive to the development of the market economy propelled by the bourgeoisie revolution of the eighteenth and nineteenth centuries, and a precursor of modern parliamentarism as an alternative to the political system of monarchy, controlled by the aristocracy. In the United States, for instance, corporate legislation was enacted in a wide number of states in the early nineteenth century, including Massachusetts (1809), New York (1811), Pennsylvania (1836), and Connecticut (1837): by the end of the 1850s, 15 more states had passed “general incorporation statutes” (Blair, 2003: 425–426). Such swift processes of imitation across U.S. states testify to the efficacy of the legislation, which made it a legal de facto standard by the late nineteenth century. Core Elements of Corporate Law Djelic (2013: 596) suggests that there are three dimensions of Corporate Law that need to be recognized: First, the corporation is “a fictional individual”—that is, the firm is enacted as a legal entity sui juris: the corporation owns itself. Second, the ownership of the modern corporation is structured around the ownership of shares, issued by the public corporation or a closely held firm; this ownership includes the right to vote during, for example, annual assemblies. Third and finally, which is a major legal innovation and one of the most controversial statutes of Corporate Law, the shared ownership is accompanied by “limited liability” (Djelic, 2013: 596)...
eBook - ePubEconomics, Capitalism, and Corporations
Contradictions of Corporate Law, Economics, and the Theory of the Firm
- Wm. Dennis Huber(Author)
- 2020(Publication Date)
- Routledge(Publisher)
...Corporate Law is an amalgamation of contract law, property law, and agency law. Economics is the science of the allocation of scarce resources. Property constitutes resources to the owner of the property. Property law determines who owns the property (government, private persons, or “the people”), which scarce resources are allocated to production (labor or capital), and how scarce resources are allocated and controlled—by the market or centrally planned by the government within society, or by and within the corporation, and how the allocation of scarce resources by and within the corporation is related to the owners of shares of the corporation. Baird and Henderson (2008), both of the University of Chicago School of Law, are insistent that Legal principles that are almost right are often more mischievous than those that are completely wrong …. An almost-right principle invites sloppy thinking, vague generalities, and a general distortion of the otherwise sound ideas that lie close by. An example of an almost-right principle that has distorted much of the thinking about Corporate Law in recent decades is the oft-repeated maxim that directors of a corporation owe a fiduciary duty to the shareholders. … People who should know better paint themselves into embarrassing corners trying to reaffirm the principle. (pp...
eBook - ePubAirline Governance
The Right Direction
- Victor Hughes(Author)
- 2020(Publication Date)
- Routledge(Publisher)
...In such a fluid environment producing a definition (i.e., a clear complete statement of the meaning) for corporate governance, is difficult. For this book, the term ‘corporate governance’ will mean ‘the rules, laws, policies and practices which govern the operations of a company’. Directors and shareholders In a company the ownership and the operation of the company are separate. This separation is fundamental to the way in which most economies work in the world and arose from the landmark case of Salomon v. A Salomon & Co Ltd. (which was decided by the United Kingdom’s House of Lords on 16 November 1897 with the ruling that the creditors of an insolvent company could not sue the company’s shareholders to pay up outstanding debts owed). This case concluded that a limited company was a separate entity from its shareholders. Essentially the shareholders own the company, although even this statement can be debated because some lenders may have a prior charge over all or some of the company’s assets, and the shareholders appoint directors to run the company for them. This separation produces the need for an approach which allows shareholders to be assured that the company is being well run, however that is defined, and is meeting its objectives, all without the shareholders interfering with the day-to-day operations of the company. The solution to this need is the requirement that the company’s directors periodically and regularly report to the shareholders on the result of the company’s operations and the current financial and business position of the company. In addition, the directors are required to run the company for the benefit of the shareholders. In general, this means they must make decisions in the best interests of the company and exercise independent judgement. They must also use reasonable care, skill and diligence in all matters relating to the company...
eBook - ePub- Andreas Kokkinis(Author)
- 2017(Publication Date)
- Routledge(Publisher)
...Indeed, company law falls within the domain of individual states and therefore company promoters can select the state of incorporation and hence the applicable company law regime they prefer, irrespective of the state where the company will be having its real centre of administration. It has thus been argued that regulatory competition is a race to the top where each state seeks to formulate the most efficient company law rules to attract incorporations. 18 Most contractarians agree that the default position of Corporate Law with regard to the internal organisation of companies should be that directors are empowered to run the business of the company insulated from shareholder interference but that, at the same time, directors owe a duty to promote the collective interests of the shareholders, and are elected by the shareholders who are the only corporate constituency having voting rights. Shareholders are also unique in their right to appropriate the residual profits of the company, after all fixed contractual claims are satisfied, via the payment of dividends or the distribution of corporate assets in the case where a company is wound up. This way of structuring the internal governance of companies, which is characteristic of the UK and US systems, 19 is described by some authors as shareholder primacy. 20 The reason why all corporate constituencies are likely to agree to the above structure and why it therefore should be the default legal position is the following. Granting all the company powers to the board and thus insulating the board from direct intervention by shareholders (or by any other group of constituents such as employees) is the only workable way to run a complicated and large organisation...
eBook - ePubRethinking Corporate Governance
The Law and Economics of Control Powers
- Alessio Pacces(Author)
- 2013(Publication Date)
- Routledge(Publisher)
...The analysis of this tradeoff, from both a positive and a normative Law and Economics perspective, will be the subject-matter of the following chapters. Positive analysis will speculate on how Corporate Law influences the models of corporate governance prevailing in different countries of the Wealthy West of the world. The foregoing analysis of the economics of corporate governance has shown on what basis the efficient structure of corporate ownership should be selected and should then evolve endogenously. However, the legal system determines to what extent that process can take place. On the one hand, legal rules need to prevent the corporate controller from expropriating non-controlling shareholders by disciplining the extraction of diversionary PBC. Unconstrained opportunities for stealing would in fact undermine separation of ownership and control. On the other hand, separation of ownership and control need also to be supported by legal entitlements to discretionary management and control safeguards. In this respect, law shapes the actual patterns of corporate governance by vesting ultimate decision-making power in one or more controlling shareholder (through the shareholders’ meeting), or in the corporate managers (through the board of directors). The flip side of the coin is that both opportunities for expropriation of non-controlling shareholders and entrenchment devices available to the corporate controller influence, in turn, the evolution of control allocation over time. Through the comparison of some representative systems of corporate governance, I will therefore investigate the Corporate Law’s role in determining the following: (a) whether the interest of non-controlling shareholders is adequately protected from expropriation; and (b) how control can be exerted by an entrepreneur-manager, how it is maintained and, ultimately, transferred...
eBook - ePubCorporate Social Responsibility, Human Rights and the Law
Multinational Corporations in Developing Countries
- Olufemi Amao(Author)
- 2011(Publication Date)
- Routledge(Publisher)
...Fourth, some CSR initiatives have given rise to consideration of legal issues in the intergovernmental context. An example is the concern of developing world’s governments in the World Trade Organization in relation to the potential negative market access impacts of labelling or certification schemes and their compatibility with WTO regulations. Fifth, civil litigation actions against parent companies of multinational corporations are targeted at many of the issues on the CSR agenda. 82 Finally, according to Ward “the rigorous legal approach to analysis that is demanded by CSR-related litigation is helpful in unpacking some of the most difficult ‘boundary’ issues about the respective roles and responsibilities of business, civil society, and governments”. 83 The legal dimension of CSR views the concept as a means of employing legal changes to attain CSR objectives. CSR is thus regarded as a step towards standards, which would be regulated eventually. 84 This view seeks to protect other constituents through changes to Corporate Law, contract law, civil liability laws, labour and human rights laws. Corporate Law, for example, can do this through expansion of director’s fiduciary duties, provision for independent directors, mandatory disclosure and social accounting, etc. Alternatively CSR is viewed as a complement to law by promoting social norms. Here other constituents are expected to be protected through self-regulation such as framework agreements and codes of conducts. A variant of the latter group are the norms scholars within Corporate Law scholarship. The norms scholars make a distinction between legally enforceable rules that bind companies and non-legally enforceable rules and standards (NLERS) where behaviour is adhered to “through a privately enforced system of rewards and penalties”. 85 The scholars sought to place these private systems within the Corporate Law structure. According to Lynch Fannon, there are two variants of this school...
