ABSTRACT
The joint stock company is the institutional form through which strategic control is mediated, and variations in the form of the joint stock company from one country to another will both reflect and influence their variant patterns of capitalist development. The mechanisms of capital mobilization, and especially the organization of the banking system and the differing roles of persons and intermediaries in the provision of investment funds, will be mediated through the prevailing form of corporate organization. All modern legal systems involve a similar conception of the property rights of shareholders, but there are important variations in the legal constitution of the board of directors. In countries that follow the practices of English law – the USA, Australia, Canada, and Britain itself – the law prescribes one and only one board, its rights and obligations being indivisible and inalienable. All directors, executives and non-executives, are appointed by the controlling shareholders and, through their monthly meetings, are responsible to the annual shareholders’ meeting (Bacon and Brown 1977; Bank of England 1979). By contrast with this ‘Anglo-American’ system, the legal codes of West Germany, Austria, Switzerland, 1 and the Netherlands prescribe a two-board system in which an executive board is responsible for overseeing the operational managers and a supervisory board of non-executives is responsible for corporate strategy and for monitoring the activities of the executive board (Grossfeld and Ebke 1978). 2 A mixed system is found in Japan, where corporate law is based on both American and German principles and a single board system is prescribed. In France, Belgium, and Italy, a ‘Latin’ variant of the two board system is found. An administrative board combines both supervisory and executive responsibilities as in the Anglo-American system, but there is also an auditing board which functions in a similar, but more formal, way to the accounting auditors in Britain and the USA. Members of the administrative board in the Latin system and of both boards in the German system operate as ‘directors’ of the type found on the single board of the Anglo-American system (Bacon and Brown 1977).
