Abstract
Earlier in this book previous theories of corporate law were divided into theories of corporate law and theories of corporations. Both have their characteristic failings. Theories of corporations tend to be narrow and based on a small group of existing norms. Theories of corporate law tend to be broader but not perfectly aligned with existing norms. In addition, theories of corporate law in the US focus on corporate governance and fail to address a large part of the regulation of companies.
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- 1.
See, for example, Bruner CM, The Enduring Ambivalence of Corporate Law, Alabama L Rev 59 (2008) pp 1386 (three fundamental and related issues) and 1408 (problems with models that focus on pure corporate governance); Bainbridge S, The New Corporate Governance in Theory and Practice. OUP, Oxford (2008) pp 14–15.
- 2.
To say that a corporation is a contract, or that a corporation is a nexus of contracts, or that the board is the nexus, would not explain why corporations are used and why the legal structure of the firm can change over time.
- 3.
Compare Fleischer H, Zur Zukunft der gesellschafts- und kapitalmarktrechtlichen Forschung, ZGR 4/2007 p 506: “Innerhalb des Gesellschafts- und Kapitalmarktrechts sehe ich zwei Kermgebiete, die Corporate Governane als zukünftige Megathemen ablösen könnten: Corporate Finance und Corporate Insolvency.“ From a historical perspective, see Bratton WW, op cit, p 1485: from the 1850s to the 1880s, the American states enacted “general corporation laws” that included “provisions respecting corporate purposes, directors’ powers, capital structure, dividends, amendments, and mergers”. Bratton cites Hurst JW, The Legitimacy of the Business Corporation in the Law of the United States 1780–1970. The University Press of Virginia, the USA (1970) p 82.
- 4.
To whom do assets linked to the company belong? Who is to be regarded as acting as or on behalf of the company? How should the persons acting as or on behalf of the company act? How should the various stakeholders act? How are these persons and stakeholders motivated?
- 5.
See, for example, Regulation 2157/2001 (SE Regulation); The Department of Trade and Industry, Company Law Reform, White Paper, Cm 6456 (March 2005); Gesetz zur Modernisierung des GmbH-Rechts und zur Bekämpfung von Missbräuchen (MoMiG).
- 6.
Mäntysaari P, The Law of Corporate Finance. Volume I. Springer, Berlin Heidelberg (2010) pp 1–2.
- 7.
Generally, see Mäntysaari P, The Law of Corporate Finance. Volume III. Springer, Berlin Heidelberg (2010).
- 8.
Bebchuk LA, The Case for Increasing Shareholder Power, Harv L Rev 118 (2005) pp 833–917.
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Mäntysaari, P. (2012). Theory of Corporate Law: Proposed Theory. In: Organising the Firm. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-22197-2_10
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DOI: https://doi.org/10.1007/978-3-642-22197-2_10
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