Companies and Securities Law Research Assignment -
Learning Objectives -
1. Communicate orally and in writing an advanced and integrated understanding of the nature of a corporate entity, how it comes into existence, operates and is terminated within a legal framework.
2. Demonstrate a sophisticated knowledge of the major statutory and case law which affects corporations, their members, officers and outsiders;
3. Critically read and interpret case and statute law analysing the effect and operations of the laws on dealing with corporations and their stakeholders;
4. Critically and strategically analyse problem situations, drawing upon the understanding and knowledge gained in the course to identify, analyse and report on corporate legal issues.
Requirement: You are expected to research a specified topic reading and interpreting cases, journal articles and law reform policy reports. You are also expected to analyse the effect and operations of these laws and policies on companies and their stakeholders and you are expected to report on corporate legal issues using a Report format. The assignment is divided into Part 1 and Part 2.
Question -
The United Kingdom Companies Act 2006 Section 172 states:
"Duty to promote the success of the company
(1) A director of a company must act in the way he considers, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to-
(a) the likely consequences of any decision in the long term,
(b) the interests of the company's employees,
(c) the need to foster the company's business relationships with suppliers, customers and others,
(d) the impact of the company's operations on the community and the environment,
(e) the desirability of the company maintaining a reputation for high standards of business conduct, and
(f) the need to act fairly as between members of the company."
The Corporations Act 2001 (Cth.) Section 181 states:
"Good faith--civil obligations
Good faith--directors and other officers
(1) A director or other officer of a corporation must exercise their powers and discharge their duties:
(a) in good faith in the best interests of the corporation; and
(b) for a proper purpose."
Should Australia adopt the UK legislation? Discuss, giving reasons for your answer. Your answer must refer to both the Corporations Act 2001 (Cth.) and the decided case law for support.