Corporate Regulation

Corporate governance has become a highly debated topic in legal research since the size and power of huge listed company became assignable. Australia set up Corporate Act in 2001, but already facing demand to revise due to recent corporate scandals. In this report, I only concern large listed companies and address following issues: firstly, giving out a board overview of corporate governance in Australia, secondly, examining James Hardies case and the collapse of HIH and discussing the impact of them on Australian cultural and society, and finally, providing some recommendations for changes to the law.

How corporate governance is currently regulated in Australia
  * What is corporate governance
In the large listed companies, owners of companies, shareholders, are less powerful than managements of companies. Corporate governance is introduced in business in order to ‘control of corporations for shareholders and to systems of accountability by managements in control’.
  * Source of regulation in Australia
Like any other areas of regulations, regulation in corporate governance also consists of different kinds of “laws”, including “hard law”, “hybrid law” and “soft law”. “hard law means traditional black- letter law”; “soft law” includes some voluntary standards set up by relevant institution that companies can choose to adopt or not; and “hybrid law” falls somewhere between the two: neither compulsory nor purely voluntary.
  * “hard law”
  * Corporate law
Australian’s priority legislation in this area is corporation Act (2001). It provide a statute basis for nearly all the aspects in companies’ governance, regulates corporate in Australia directly or indirectly from directors’ duties to shareholder rights and remedies. It deals with dilemma among shareholders, directors and management. ‘Many of these provisions are mandatory rules, with sanctions imposed for non-compliance’.
However, obeying corporation Act(2001) doesn’t means that...