Question

Although a company is run on the will of majority shareholders, it does not mean that majority shareholders can pass resolutions at their own whims and fancies. The law will step in to protect minority shareholders where their rights and interests are affected. Nevertheless, the uppermost question is whether the current laws governing minority shareholder protection are adequate. Equally imperative is also whether minority shareholders play an active role in keeping a check on the way a company is being run i.e. shareholder activism. Discuss and critically examine the above statement. Include in your discussion, the legal position in the United Kingdom, Australia, Singapore, Canada or New Zealand. The comparison should indicate that the country has adopted a more comprehensive approach in protecting minority shareholders.

Answer 1

Answeds- Summarized the information given in the question, although a company is run an y The right to receive all the agendas croculated by the compang, The right to persuade other shareholders to vote in a given way. » Cortical decisions of the company have to be supported by atlecest 50% of the members. → - Minosity shareholders can institute a derivative suit to have the decisions passed by the majority quashed by the court In this discussion, we will use Australia The companies act governs companies in Australia. The companies Act provides for numerous protection of the minority shooseholders. Some of the avenues available to the minority include: The right to receive all the company agendas circulated and raise their objection make their contribution. The right to persuide other shareholders to vote in a given way. Critical decisions of the company have have to

be supported by atlecest. 75% of the members This ensures that no such decision can be without the majority. of necroly all the shareholders' centribution. Lastly the minority shareholders can institute a derivative suit to have the decisions passed by the majority quashed by the court. As evidenced above, minority shareholders are adequately protected by the law. Nonetheless, drag along with sules, in most instances; will have to be applied.
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