Papers by Jean Jacques du Plessis
Corporate Governance in Practice
The concept ‘corporate governance’ and essential corporate governance principles
Cambridge University Press eBooks, Jul 28, 2005
The case for enhanced shareholder participation in corporate decision-making
Cambridge University Press eBooks, Jul 28, 2005
Principles of Contemporary Corporate Governance
Corporate governance in Australia – background and business initiatives
Cambridge University Press eBooks, Jun 15, 2012
Preface to the first edition
Cambridge University Press eBooks, Jun 15, 2012
Accounting governance
Cambridge University Press eBooks, Jun 15, 2012
Stakeholders in corporate governance and corporate social responsibility
Cambridge University Press eBooks, Jun 15, 2012
What we are witnessing is a shift in the content of the shareholder value norm, so that it comes ... more What we are witnessing is a shift in the content of the shareholder value norm, so that it comes to represent the idea that shareholders exercise their powers not as representatives of the market, but as agents of society as a whole. The corporate governance of the future will be centrally concerned with how this idea is worked out in practice. Simon Deakin, ‘The Coming Transformation of Shareholder Value’ (2005) 13 Corporate Governance: An International Review 16 To create an enduring society we need a system of commerce and production where each and every act is inherently sustainable and restorative. Business will need to integrate economic, biologic, and human systems to create a sustainable method of commerce. As hard as we may try to become sustainable on a company-by-company level, we cannot fully succeed until the institutions surrounding commerce are redesigned. Paul Hawken, The Ecology of Commerce (Harper Business, revised edn, 2010) xii Introduction As touched upon in Chapter 1, contemporary commentary on corporate governance can, in general terms, be divided into two main camps: those who consider corporate governance as being about building effective mechanisms and measures to satisfy the expectations of the variety of individuals, groups and entities (collectively, ‘stakeholders’) that inevitably interact with the corporation, and those who focus on it in relation to the narrower expectations of shareholders (shareholder primacy). This chapter focuses on the first of these objectives, with attention being given to the stakeholders of the company, how the law influences corporations to recognise and protect the interests of these stakeholders, and the relationship between these stakeholders and the underlying objective of companies of achieving and maintaining good corporate governance. Steve Letza, Xiuping Sun and James Kirkbride explain the difference between the two corporate governance paradigms, ‘shareholding’ and ‘stakeholding’, as follows: Such a division hinges on the purpose of the corporation and its associated structure of governance arrangements understood and justified in theory. On one side is the traditional shareholding perspective, which regards the corporation as a legal instrument for shareholders to maximise their own interests – investment returns. A three-tier hierarchical structure, i.e. the shareholder general meeting, the board of directors and executive managers, is given in company law in an attempt to secure shareholders’ interests …
Stakeholders in corporate governance
Cambridge University Press eBooks, Jul 28, 2005
Corporate Governance in International and Global Contexts
Board functions and structures (with contributions by Jeanne Nel de Koker)
Cambridge University Press eBooks, Jun 21, 2018
There is now overwhelming evidence that the board system is falling well short of adequately perf... more There is now overwhelming evidence that the board system is falling well short of adequately performing its assigned duties. Without fundamental improvement by individual boards, the entire board system will continue to be attacked as impotent and irrelevant and the boards of troubled and failing companies will, with good reason, increasingly become the targets of not only aggrieved and angry shareholders but also employees, creditors, suppliers, governments, and the public. David SR Leighton and Donald H Thain, Making Boards Work (1997) 3 Unless they served on a board, people may well imagine that directors behave rationally, that board level discussions are analytical, and that decisions are reached after careful consideration of alternatives. Not often. Experience of board meetings, or of the activities of any governing body for that matter, shows that reality can be quite different. Directors’ behaviour is influenced by interpersonal relationships, by perceptions of position and prestige, and by the process of power. In fact, corporate governance is more about human behavior than about structures and strictures, rules and regulations. Corporate governance involves the use of power. It is a political process. Bob Tricker, Corporate Governance: Principles, Policies and Practices (2012) 327 Higher community expectations of directors Initially low standards of care, skill and diligence expected of directors Directors’ statutory duties and liability are discussed in greater detail in Chapter 9. It is, however, important to first make a few observations regarding the higher community expectations of directors. Based on antiquated English precedents, it has been accepted that directors are not liable for a breach in their duty of care, skill and diligence if they merely acted negligently. One of the first indications that more than ordinary negligence was required is found in an English case decided in 1872, where it was held that directors are liable only for a breach of their duty of care, skill and diligence if they acted with crassa negligentia (gross negligence). This rule was confirmed in a later case (1899) by Lord Lindley MR, one of the most famous English commercial Lords: The inquiry, therefore, is reduced to want of care and bona fides with a view to the interests of the nitrate company.
Corporate Governance in Australia
The concepts of ‘corporate governance’ and ‘essential’ principles of corporate governance (with contributions by Jeanne Nel de Koker)
Cambridge University Press eBooks, Jun 21, 2018
It is necessary only for the good man to do nothing for evil to triumph. Attributed to Edmund Bur... more It is necessary only for the good man to do nothing for evil to triumph. Attributed to Edmund Burke (18th century English political philosopher) – The Australian, 6 December 2004, 4, reporting on the most favoured phrase of quotation-lovers, as determined by an Oxford University Press poll Many companies today no longer accept the maxim that the business of business is business. Their premise is simple: Corporations, because they are the dominant institution on the planet, must squarely address social justice and environmental issues that afflict humankind. Paul Hawken, The Ecology of Commerce (Harper Business, revised edn, 2010), xi The meaning of corporate governance Generally Corporate governance is as old as the corporate form itself. However, the phrase ‘corporate governance’ was scarcely used until the 1980s. Issues of corporate governance first gained international prominence in the late 1990s and early 2000s in the wake of a series of corporate accounting scandals, most notably Enron in the US and HIH in Australia. The focus on corporate governance increased after 2008, in the aftermath of the Global Financial Crisis. Inasmuch as a discussion of the principles of contemporary governance requires a closer description of ‘corporate governance’, the concept remains one that does not lend itself to a single, specific or narrow definition. Corporate governance, by its very nature, is organic and flexible, constantly evolving in response to a changing corporate environment. A comparison of older definitions or descriptions of corporate governance, such as those used in the South African King Report (King I) in 1994, and more recent definitions, such as those used in the G20/OECD Principles of Corporate Governance and the King IV (2016) Report reveals how the focus has shifted from a narrow, inward-looking approach that primarily addresses internal director-related rules within the corporation to an outwardlooking, more inclusive and multi-faceted approach that recognises that corporate governance is about much more than managing the manner in which directors exercise and control authority in corporations. Early attempts at a definition focused on ‘corporate governance’ as a ‘system’: the UK Cadbury Report (1992) and King I both defined ‘corporate governance’ as ‘the system by which companies are directed and controlled’.
The role of the regulators: ASIC and the ASX
Cambridge University Press eBooks, Jun 21, 2018
[HIH Insurance Ltd's collapse] is a tale of scoundrels – crooks even, who jockey and grasp an... more [HIH Insurance Ltd's collapse] is a tale of scoundrels – crooks even, who jockey and grasp and concoct the most ingenious ways to pocket HIH's cash while they still can. Well-placed mates help well-placed mates … Mortgages are forgiven, bonuses awarded, dodgy invoices are fast-tracked and cheques are somehow cleared after the banks have closed. But policy-holders get nothing because that is the new policy, and shareholders might as well not exist. The Australian, 15 January 2003 The regulators failed in their duty to protect the interests of investors in Forrest v ASIC (2012). The ASX failed to enforce timely compliance with the continuous disclosure regime to ensure that the market was properly informed … ASIC failed to succeed in the High Court because of the way it pleaded its case … From the perspective of investor protection, the combined effect of the approaches taken by the regulators, ASX and ASIC, and the High Court [in this case] … has resulted in a ‘perfect storm’. John Humphrey and Stephen Corones ‘Forrest v ASIC: “A Perfect Storm”’(2014) 88 Australian Law Journal 26, 37 Introduction This chapter highlights the roles of and relationship between the twin regulators, the Australian Securities and Investments Commission (ASIC) and the Australian Securities Exchange (ASX) in the Australian corporate governance regime. The exercise of ASIC's powers is reviewed and enforcement patterns are commented upon. The chapter sketches the role of the ASX in corporate governance and concludes with remarks addressing the broad philosophical debate on the role of the regulator in light of the carnage (the widespread corporate collapses or near collapses) arising from the Global Financial Crisis, and the pressure on ASIC to be more proactive and to perform to a higher standard. The reasons for the parliamentary inquiry into ASIC's performance are captured in the following passage: The emerging revelations about the misconduct of financial advisers in Commonwealth Financial Planning Limited (CFPL), part of the Commonwealth Bank of Australia Group and ASIC's failure to provide satisfactory answers in relation to this matter to the Economics Legislation Committee was the main catalyst for the inquiry.
Corporate Governance in the EU, the OECD Principles of Corporate Governance and Corporate Governance in Selected Other Jurisdictions
Springer eBooks, Oct 21, 2011
Good corporate governance is a top priority in business worldwide. We have witnessed scandalous c... more Good corporate governance is a top priority in business worldwide. We have witnessed scandalous corporate collapses like Enron, WorldCom, Global Crossing, and Tyco (all USA), Parmalat (Italy), Livedoor (Japan), SK Group (South Korea), Satyam (India) and others in many countries. When financing companies in global markets, the temptations of corporate corruption have to be viewed from an international perspective. In the aftermath of the ‘Enron’-era we saw a powerful global tide towards higher standards in corporate governance.
Springer eBooks, 2017
The use of general descriptive names, registered names, trademarks, service marks, etc. in this p... more The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.
Corporate Governance Codes Under the Spotlight
Springer eBooks, 2017
Although somewhat simplistic, this highlights the importance of processes that companies should i... more Although somewhat simplistic, this highlights the importance of processes that companies should institute and implement to ensure that effective practices transcend the various levels of the organisation. These were viewed at the time as necessary responses to what was considered a lack of managerial oversight which led to the spectacular corporate collapses of the Bank of Credit and Commerce International, Coloroll, the Polly Peck Group and Maxwell Communication Corporation in the late 1980s and early 1990s. These collapses not only resulted in substantial financial losses to shareholders, employees, creditors, investors as well as the government—they were also perceived as posing considerable challenges to the integrity and reputation of the City of London as an international financial centre.
Reflections on contemporary corporate governance and its future direction
Cambridge University Press eBooks, Jun 15, 2012
European Business Law Review, Apr 1, 2019
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Papers by Jean Jacques du Plessis