Corporate Governance, Corporate Responsibility and Law: Shareholder Primacy and Other Stakeholder Interests

Company and Securities Law Journal, Forthcoming

Deakin Law School Research Paper No. 16-25

7 Pages Posted: 11 May 2016 Last revised: 22 Sep 2019

See all articles by Jean Du Plessis

Jean Du Plessis

Deakin University, Geelong, Australia - Deakin Law School

Date Written: 2016

Abstract

In this note a few comments are made as to how it happened that shareholders were generally treated as the "owners" of the company and how that has now been vigorously challenged as an overstatement. Whilst the law in Australia, at least, still treats the duties of the directors of a company as being owed to the company as embodied by the current and future shareholders, it is now generally conceded that other stakeholders believe they have a very real interest in the company. It will also be illustrated that there are more and more official recognition of other stakeholders, especially in the European Union (EU). It will be shown that it is unlikely that the role shareholders play in corporate governance will diminish soon. Shareholder primacy is still underpinning our corporate law and corporate governance model. However, should we simply accept that model or should we work towards reflecting the practical reality that corporations exist and thrive because there are vitally important stakeholders other than the shareholders?

Suggested Citation

Du Plessis, Jean, Corporate Governance, Corporate Responsibility and Law: Shareholder Primacy and Other Stakeholder Interests (2016). Company and Securities Law Journal, Forthcoming, Deakin Law School Research Paper No. 16-25, Available at SSRN: https://ssrn.com/abstract=2777832

Jean Du Plessis (Contact Author)

Deakin University, Geelong, Australia - Deakin Law School ( email )

221 Burwood Highway
Burwood
Burwood, Victoria 3125, Victoria 3125
Australia

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