Study Of Shareholder Decision-making Power On The Uk Companies Act

Since 1933 when the theory of "Separation of ownership and control" was proposed by Berle and Means, the focus of corporate governance has transferred from shareholders to board of directors, especially in those large scale listing company giants. Directors make great contribution to the success of companies due to their management expertise and other talents. As for the business of companies become larger and larger, the advantages of central management have been demonstrated vividly in the market. However, the ultimate owners of the companies are shareholders rather than directors, directors are solely agents of the owners. When the directors are not properly under control, they tend to utilize their power and advantages to make profits for private purposes rather than for the whole company and the shareholders. So in recent years, people again fix their attention on the solution to the agency problem, and shareholders' benefits should be particularly put under protection. Law professors as well as legislatures think about whether shareholders could take decision in the management affairs. On the other hand, the same problem would occur not only between shareholders and board of directors, but also could occur between controlling shareholders and minor shareholders. Controlling shareholders could utilize their advantages in the voting process, even they could elect themselves as directors to manage the company directly. In such cases, minor shareholders' benefits could be harmed by controlling shareholders.The paper mainly studies the decision rights of shareholders in UK company law. There are four chapters except for introduction.In introduction part, the author briefly defines the term shareholders' decision rights. Chapter one mainly discusses the contents of shareholders' decision rights in UK company law in force. The author analyzes the regulations in statute law as well as case law. Transactions involving contracts of interests between directors and the company as well as directors' remuneration are also discussed as special topics. In chapter two the author discusses the execution process of shareholders' decision rights. General regulations and specific regulations for private companies are discussed in the two sections respectively.Chapter three mainly studies the allocation of decision rights between controlling shareholders and minor shareholders. Remedies for unfairly prejudicial conduct of the company's affairs are also examined.In the last chapter the author fix her attention on Chinese company law regulations relative to shareholders' decision rights. Comparisons between UK law and Chinese law's corresponding regulations are also conducted. Finally the author proposes some modification suggestions for the Chinese company law about the shareholders' decision rights.