ABSTRACT
In the US and the UK, efforts to reform company law in general, and governance of public corporations in particular, have centred on making corporate executives more responsive to the demands of shareholders – reinvigorating ‘shareholder democracy’, as it is often termed. This can be seen in the Hampel Report1 in Britain and in the activities of organisations such as the LENS fund2 in the United States. It is argued that institutional investors, by virtue of their financial expertise and the size of their holdings, are becoming well placed to take up a monitoring role over management.3 Where monitoring has been entrusted to non-executive directors, in the UK they usually come from the financial side of business life (frequently with accounting qualifications) and often from the same type of company as the executive directors they supervise. Other stakeholders in UK public companies, including employees and suppliers, have in general not been treated as business partners, but as instruments to be used in the production of profit.
