COMPANY HIERARCHIES
Most boards fail to walk the talk of increased shareholder agency
The promise of a new era in corporate governance brought by Companies Act has not come to fruition, write Audrey Elster and Kathleen Satchwell
There was a lot of excited chatter about a new era of shareholder activism when the Companies Act of 2008 came into effect in 2011. It wasn’t just the substantial new appraisal rights shareholders were given and the improved derivative action remedy. There was also the enhanced ability of shareholders to call a meeting, as well as the seeming ease with which they could now propose resolutions to be considered at a shareholders meeting. The excitement, which led to nervous tension in boardrooms, was reminiscent of the excitement that followed the launch of the King Report on Corporate Governance in 1994. That report was the first "establishment-aligned" document to formally highlight the important role shareholders had to play in effective governance of companies. However, while it sought to encourage more active engagement, the report made little distinction between shareholders and other stakeholders. And, despite the nod to stakeholders, it seemed intent on stressing the legal sup...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.