Rethinking the Law on Shareholder-Initiated Resolutions at Company General Meetings

41 Pages Posted: 18 Sep 2019

Date Written: September 17, 2019

Abstract

Recent concerns about the need for improved corporate accountability raise questions about the role of shareholders in corporate governance. One aspect of these discussions is the capacity of shareholders in general meetings to propose non-binding advisory resolutions concerning governance or social matters. Since Automatic Self-Cleansing Filter Syndicate Co Ltd v Cuninghame in 1906, courts have held that if a company’s constitution gives directors the power of company management, shareholders cannot interfere with the exercise of that power. The Federal Court affirmed this in Australasian Centre for Corporate Responsibility v Commonwealth Bank of Australia. This paper re-examines the case law, particularly in its application to advisory resolutions, and recommends the introduction of a broad statutory authority for non-binding advisory resolutions. The paper argues that this is an important step towards improved corporate accountability and responsible shareholder engagement.

Keywords: Companies, Corporate Accountability, Shareholders, General Meetings, Advisory Resolutions

Suggested Citation

Bottomley, Stephen, Rethinking the Law on Shareholder-Initiated Resolutions at Company General Meetings (September 17, 2019). Melbourne University Law Review, Vol. 43, No. 1, 2019, ANU College of Law Research Paper No. 19.21 (2019), Available at SSRN: https://ssrn.com/abstract=3455110

Stephen Bottomley (Contact Author)

ANU College of Law ( email )

Canberra, Australian Capital Territory 0200
Australia

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