LLM International Corporate and Commercial Law Journal

Here is an example of an LLM International Corporate and Commercial Law Journal that was set as part of the assignment.

Seminar Journal, Advanced Company Law

LECTURE 1

Companies created under royal charters in the 17 and 18th century were given a monopolies over overseas territories which raises significant competition law issues. The South Sea company demonstrates the early development of the separation of ownership from control and the lack of corporate governance mechanisms at the time which is supported by the view of Adam Smith who wrote that people in charge of other people’s money wouldn’t  exercise as much care as they would with their own. In this lecture I found it fairly challenging to track the historical developments in company law. In order to address this issue, I constructed a short chronology with the significant historical developments which aided my learning.

LECTURE 2

In this lecture I learnt that corporation, like humans have human rights (hr) which ties in with the issue of separate legal personality.  Given that companies’ have obligations under hr, it is only fair to provide companies with reciprocal protection under the hr, which I feel is partially done to promulgate a stakeholder model to benefit the society as a whole. Conversely, providing large corporation with hr can be dangerous as they could distort the human rights traditionally applied to “humans” and erode the hr of “humans” in favour of large multinationals which would undermine the traditional purpose of hr. This lecture stimulated my critical thinking ability as I was required to analyse competing arguments and reach an objective position. In my view, companies are vested with hr rights as a bargain to prevent a greater damage multinationals could cause to the society.

LECTURE 3

In this lecture I gained a good understanding that limited liability encourages investment in the capital markets because it limits monitoring costs and makes capital and equity cheaper which relates directly to the corporate governance issue. The issue of limited liability developed my critical and problem-solving skills since I observed that there are drastic limits to limited liability especially during the liquidation of a company whereby creditors have a right to exhaust a company’s assets and thereafter go after the shareholders. Likewise, in practice, limited liability is easily forfeited whenever a business obtains a loan (lifeblood of a business) whereby the shareholders or members of the company have to act as sureties or give guarantees.

LECTURE 4

Disclosure is a vital corporate governance mechanism for public companies where there is a separation of ownership from control due to dispersed shareholding. In this lecture I gained a good understanding that disclosure of company financial information is important in the wider economic context since it provides transparency to the general public about the financial health of companies. Nevertheless, the disclosure regime on an international stage is questionable because many banks still go into liquidation despite healthy accounts such as Snoras Bank in Lithuania which had a clean bill of health but it later transpired that that the bank had a deficit of £2 billion.

LECTURE 5

In this seminar, I developed my critical thinking and analytical skills in the context of the Companies Act 2006 (CA) and the arguments surrounding corporate Social Responsibility (CSR). I learnt that the concept of enlightened shareholder value is a very important concept in the contemporary commercial landscape in helping to preserve the integrity and success of the company. The codification of the CSR factors and the requirement of a business review report from listed companies in the CA highlights the importance of CSR. These provision are especially important in preserving the transparency in protecting shareholders in the realm of public companies where the shareholding is very disperse with a separation of ownership from control. However, it appears that there is a lack of guidance in the CA as to the enforcement of the CSR duties and there is a risk that this may simply become a window-dressing exercise for most companies.

LECTURE 6

In this seminar, I applied my critical thinking and analytical skills by drawing the conclusion that the Stewardship Code was introduced in response to the financial crisis in order to make investors to take a longer term view and hold reckless boards to account in order to prevent bank collapses. I critically deducted that the key principle of the code is to enhance the ability of institutional investors to collaborate on governance issues as well as to develop a more robust corporate governance structure since management teams.

LECTURE 7

In this seminar, I applied and developed my analytical and communication skills by weighing up the arguments justifying greater gender equality on the boards of listed companies. I found the business case along with CSR responsibility to be the most compelling reasons for gender equality on the board because this is likely to enhance the positive perception of a company by its stakeholders which will bestow a competitive advantage upon it. Nevertheless, I feel that the quota system and sex-discrimination laws may be too imposing through their “mandatory” nature and may lead to a box-ticking exercise. Instead, the board selection process should be left entirely to the companies since the CSR is likely to be the best enforcement mechanism through publicity and media which can have a very material and significant impact on companies as it sways consumer behaviour.

LECTURE 8

It is unlikely that German coordinated market system will completely converge with the Anglo-American liberal market system, given the strong roots of industrial democracy that is enshrined in law and the citizens’ demand for a socially acceptable economic system. Germany, however, has to solve its unemployment problem which seems to reflect the related socio-economic deficiencies. This might require incisive cuts in social security benefits, deregulation of rigid labour market structures and an adjustment of the German Social Model towards a more market-oriented system.

LECTURE 9

In this seminar, I learnt that the challenges and failure of corporate governance in Africa stems from the culture of corruption and lack of institutional capacity to implement the codes of conduct governing corporate governance. Developing countries in Africa such as Nigeria and other sub-Saharan countries are poorly equipped to implement the type of corporate governance found in the developed market economies because these African countries are characterised by state owned firms, interlocking relationships between governments and financial sectors, weak legal and judiciary systems and limited human resources capabilities.

LECTURE 10

In this seminar, I developed my analytical and problem-solving skills by comparing the concept of corporate governance against the backdrop of the financial crisis. Corporate governance is at the heart of the financial crisis since in many cases CEO remuneration has not closely followed company performance. During this year’s annual meeting of Barclays bank, the bank’s remuneration report reflected widespread anger among shareholders who argue the bank should not have increased bonuses during a year when the bank’s profits fell by more than a third. In order to reduce corporate excess and avert bank defaults, corporate governance of banks should be improved in order to, as advised by the OECD, to align key executive and board remuneration with the longer term interests of the company and its shareholders.