Company Directors' Views Regarding Stakeholders

142 Pages Posted: 24 Oct 2007 Last revised: 5 Feb 2014

See all articles by Meredith A. Jones

Meredith A. Jones

University of Melbourne - Law School

Shelley D. Marshall

RMIT University

Richard Mitchell

Monash University - Department of Business Law & Taxation

Ian Ramsay

Melbourne Law School - University of Melbourne

Abstract

This research report provides detailed analysis of data collected from a major survey into how company directors balance the competing and sometimes conflicting interests of stakeholder groups, including employees, creditors and shareholders. The findings have significant policy implications. The obligations of directors toward company stakeholders and whether the law of directors' duties needs to be changed have been the subject of much public debate. There have been government inquiries on this topic in a number of countries. However, there has been little empirical evidence of directors' attitudes and business practice.

The survey tested directors' understanding of their obligations under the law and their priorities in relation to stakeholders using simple ranking exercises and a more sophisticated 'salience' test in order to gain a more nuanced understanding of the extent to which directors prioritise particular interests. The survey revealed results which suggest that directors do not adhere to a simple 'shareholder primacy' corporate strategy.

Suggested Citation

Jones, Meredith A. and Marshall, Shelley D. and Mitchell, Richard James and Ramsay, Ian, Company Directors' Views Regarding Stakeholders. U of Melbourne Legal Studies Research Paper No. 270. Available at SSRN: https://ssrn.com/abstract=1023259 or http://dx.doi.org/10.2139/ssrn.1023259

Meredith A. Jones

University of Melbourne - Law School ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia

HOME PAGE: http://cclsr.law.unimelb.edu.au/index.cfm?objectid=E3D272AA-B0D0-AB80-E29ECC5DD9A85AF7#meredith

Shelley D. Marshall

RMIT University ( email )

Melbourne Campus
Building 13
Melbourne, Victoria 3000
Australia
+613 99251382 (Phone)

HOME PAGE: http://www.rmit.edu.au

Richard James Mitchell

Monash University - Department of Business Law & Taxation ( email )

Caulfield Campus
Sir John Monash Drive
Caulfield East, Victoria 3084
Australia

Ian Ramsay (Contact Author)

Melbourne Law School - University of Melbourne ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia
+61 3 8344 5332 (Phone)

HOME PAGE: http://law.unimelb.edu.au/about/staff/ian-ramsay

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