Macleod and the offence of defrauding the company in one-person businesses: the divergence between legal principle and logic widens

The recent High Court decision in Macleod v R establishes that a director and sole shareholder may be convicted of fraudulently applying a company's property even though the person has consented to the personal use of the company's property. It is contended that while this decision is consistent with the weight of precedent, it is wrong in principle. The decision implies that corporations are not only separate legal entities, but that they are highly virtuous legal entities -- incapable of being imbued with the dishonest intentions and activities of the individuals controlling the company.

Codes of ethics: what are they really and what should they be?

Codes of ethics are prevalent in major corporations around the world. They are seen as the first tangible commitment to being ethical. This paper examines codes of ethics and tries to establish what they are, how they are developed and their net utility. We then proffer the idea of codes as the first part of a five-stage process that leads to an overall corporate commitment to being ethical in one's business dealings.

Reflections on some recent corporate governance reforms in Germany. A transformation of the German aktienrecht?

Focuses on the German law reform relating to public corporations. Flaws to the German system of corporate governance; Advantages of comparative corporate governance research; Features of the German Corporate Governance Code.

The German two-tier board and the German corporate governance code

This paper deals with some interesting recent corporate governance developments in Germany. The focus is in particular on the German Corporate Governance Code, its parts, layout and how it deals with the various organs of German public corporations. The German Code is quite unique since it applies a Code of Good Practice to a two-tier board system, thus making it necessary to deal with the role and functions and the relationship between the management and the supervisory board. This paper concludes that several changes to the German law relating to public corporations since the middle of the 1990s and the introduction of the German Code will ensure that the two-tier board system will remain the favoured board structure for public corporations in Germany. It is, however, submitted that employee participation at supervisory board level will provide particular political challenges for Germany in the near future.

A Look at Corporate Code of Conduct Legislation

Over recent years, there has been a growing perception among civil society in the developed world that multinational corporations are engaged in socially and environmentally exploitative practices that they would never get away with, or even attempt, in their home countries. Whether right or wrong, that perception and its political and economic ramifications have driven a global movement for more responsible corporate behavior. As part of that global movement, three common law jurisdictions—the United States, Australia and the United Kingdom—have seen legislation introduced to enforce standards of practice for multinational corporations based in those countries in respect of their overseas activities. None of those Bills has yet passed into law, but they are worthy of analysis as attempts to transform hitherto amorphous concepts like 'corporate social responsibility' into concrete legislation. This article compares and critically analyses the three Bills, making recommendations as to how they could be improved, with particular emphasis on the need to forge stronger links between the legislative provisions and international human rights law.

Holding the purse strings : the continuing evolution of human rights law and the potential liability of the finance industry for human rights abuses

While the responsibility of States and, in more recent times, corporations, has been thoroughly discussed in relation to human right~, a new stage of evolution may be emerging in relation to the liability of the financial backers of an enterprise that is accused of human rights abuses. This article considers the basis in international law for such emerging liability and examines some of the legal avenues used in recent domestic litigation against financial institutions. The article concludes by examining some of the relevant instruments of 'soft' international law and notes that although there is little in the way of concrete legislation or judicial precedent that would hold financial institutions responsible for the actions of those they invest in, the potential for the law to evolve in that direction is clear.

Directors' personal liability-is the proposed amendment to Section 197 acceptable when compared with Hanel v O'Neill?

On 2 June 2005, the Australian Government announced a proposal to amend s. 197 of the Corporations Act. This is to overturn the decision in Hanel v. O'Neill ("Hanel") where the South Australian Supreme Court has expanded the circumstances in which directors of trustee companies can be held personally liable for the debts under the current section 197(1) of the Corporations Act 2001 (Cth). The multiple interpretations presented in Hanel highlighted the uncertainty of s. 197 and this uncertainty is heightened in at least two subsequent cases. The article provides a detailed analysis of how the decision in Hanel is affecting the directors' freedom of management and suggests some precautionary measures that the directors could take as protection against creditor's actions under s. 197. The author welcomes the proposed amendment because the new section will create certainty for directors as to. the scope of their potential personal liability, but contends that the substance of the proposed s. 197 is not acceptable as there is potential for abuse by directors of certain trustee companies.

Corporate donations, the best interest of the company and the proper purpose doctrine

Corporate philanthropy is illegitimate spending by powerful corporate elite of someone else’s money; an attempt to bypass democratic allocation of taxes; philanthropy by individuals is laudable, but not by corporations.

Just as I wouldn’t want you to implement your personal judgments by writing checks on my bank account for charities of your choice, I feel it inappropriate to write checks on your corporate ‘bank account’ for the charities of my choice.

Some care, little responsibility? Promoting directors'and managers' legal accountability for Occupational Health and Safety in the workplace

Health and safety at work remains a serious and under-recognised problem in Australia. This paper argues for the importance of increasing the individual responsibility and accountability of senior managers and directors of corporations for the development and maintenance of occupational health and safety (OHS) standards in the workplace. In order to do so, the paper first sets out the range of statutory and general law duties and liabilities to which directors and senior managers are subject, considers to what extent these obligations have relevance in the OHS area and argues for the extension of these duties and liabilities in some circumstances. The paper then goes on to argue for a better legislative model for the legal responsibility of managers and officers, supported by the increased prosecution of individuals in appropriate circumstances, as well as acknowledging the benefits of a broader range of non-legal strategies to improve board level commitment to OHS that will influence corporate compliance overall.

Snapshop of current Australian biotechnology boom indicators

Presents an update on the indicators of biotechnology growth in Australia as of December 2005. Estimated public sector spending on biotechnology research & development in the period 2002-2003; Employment status in 2004; Mergers and acquisitions in the 3rd quarter of 2005.

Removal of directors of public companies takes centre stage in Australia : an exploration of the corporate law and governance issues

Increasing attention is being given to the legal and governance issues relating to the removal of directors in Australian public companies. This has been due mainly to the difficulties experienced by the board of National Australia Bank in attempting to remove one of its fellow directors, and the subsequent development of public companies entering into so-called 'prenuptial agreements' with new directors, requiring that the director 'resign' if the board pass a vote of no-confidence in the director. In this article, the author revisits the area of director removal in Australian public companies for two reasons. The first reason, which covers the majority of the article, is to engage in a detailed analysis of whether the pre-nuptial agreements which some public companies have indicated that they support using to remove directors, are in fact enforceable under Australia's Corporations Act The second reason is to outline a law reform proposal to enable public companies to remove directors without requiring the vote of shareholders at a general meeting. The proposal involves providing Australia' corporate  regulator, the Australian Securities and Investments Commission (ASIC) with the power to grant relief from the statutory removal provisions to public companies, but in a way which balances the competing objectives of commercial efficiency and shareholder participation and, very importantly, encourages good corporate governance practices by companies in relation to the performance assessment  of directors.

It is in the interests of both shareholders and directors to agree on a set of ground rules for the effective supervision of companies that reconciles the rights of the owners to overall control with the much tougher demands on modern directors

Directors' duties to stakeholders : a reform proposal based on three false assumptions

The Corporations and Markets Advisory Committee has been asked to consider whether the duties of directors under the Corporations Act 2001 (Cth) should be broadened to require directors to take into account the interests of stakeholder groups other than shareholders when making corporate decisions. In this article, the author argues that the existing statutory duties of directors in Australia should remain unchanged. The existing duties of directors, in particular the overriding duty of directors to act in the best interests of the company, already accommodates consideration of stakeholder interests by directors if the decision is justifiable as being in the company's best interests. Furthermore, corporate culture and norms are moving towards embracing stakeholder engagement, again with the implicit recognition that integrating stakeholder considerations within the decision-making processes of companies is integral to achieving long-term sustainable growth.

Recent amendment to section 197- is it acceptable?

The majority decided in Hanel v O’Neill that directors of trustee companies
could be held personally liable to discharge the debts incurred by a
company pursuant to s 197(1) of the Corporations Act 2001 (Cth). On
18 November 2005, legislation was passed to amend s 197(1); this was to
overturn the decision. This article evaluates other relevant cases and
argues that the recent amendment to s 197 is unsatisfactory as it leaves
potential for abuse by directors of certain trustee companies. The article
suggests further reform to the section and to this end, suggests ways for
s 197 to reconcile with other parts of corporate law, such as insolvent
trading and directors’ duties.

Remembrance of things past? Change, development and paternalism

As part of a retrospective study of effects of organizational change on interpersonal relations, this paper discusses change talk among Australian employees of an American multinational manufacturing enterprise. Interviewees tended to feel pushed into change, discussing its effects in terms of the difficulties of adolescence and earlier experiences of sudden independence. Over time, what had been a simple and firm us and them division in intergroup relations between management and unions/workers had become more fluid and subtle, and perhaps more mature. Interview data are interpreted and then re-interpreted in terms of theories of team development, nostalgia, and paternalism. It is argued that each interpretation makes differing, but complementary, assumptions about the nature of time. If developmental, progressive assumptions of organizational change are relaxed, further attention can be given to theorizing and researching subtleties in talk of the past.

Mad hatter's corporate tea party

This paper aims to provide an insight into the corporate greed and consequent corporate collapses of companies such as HIH, One.Tel and Harris Scarfe in Australia, while concurrently, Enron, WorldCom and other companies were attracting the attention of the accounting profession, the regulators and the general public in the USA. It is argued that the rise in economic rationalism and the related increased materialism of both the public and company directors and managers, fed the corporate excesses that resulted in spectacular corporate collapses, including one of the world’s largest accounting firms. The opportunistic behaviour of directors, and managers and the lack of transparency and integrity in corporations, was compounded by the failure of the corporate watch-dogs, such as auditors and regulators, to protect the public interest. If the history of bad corporate behaviour is not to be repeated, the religion of materialism needs to be recognised and addressed, to ensure any corporate governance reforms proposed for the future will be effective.