¹ KW Wedderburn, “Companies and Employees: Common Law or Social Dimension?”(1993) 109 LQR 220 at 221. For examples of recent “colonisations” of formerly distinct areas of legal study, however, see H Collins, “Organizational Regulation and the Limits of Contract” in J McCahery, S Picciotto, C Scott (eds),Corporate Control and Accountability: Changing Structures and the Dynamics of Regulation (1993) 91.

² See R C McCallum, “The Internationalisation of Australian Industrial Law: The Industrial Relations Reform Act 1993” (1994)16Syd L Rev 122.

³ See H C Katz, “The Decentralization of Collective Bargaining: A Literature Review and Comparative Analysis” (1993) 47 Industrial and Labor Relations Review 3, for an examination of manifestations and implications of this trend in Australia, Sweden, Germany, Italy, the United Kingdom and theUnited States. According to Professor Katz, Australia and Sweden had the most highly centralised bargaining structures prior to the trend to decentralisation

⁴ Various hypotheses for the decentralisation trend exist. These include conjecture that the trend results from, and maintains, increased management power; that it reflects the emerging importance of “fast and innovative reactions to changing market conditions”, particularly in times of economic crisis (see W Streeck, “Neo-Corporatist Industrial Relations and the Economic Crisis in West Germany” in J H Goldthorpe (ed), Order and Conflict in Contemporary Capitalism (1984) 291 at 293-294); or that it emanates from the decentralisation of the corporate organisational structure, in which responsibility for industrial relations is shifted to lower-level managers. See generally H C Katz, above n 3 at 12-17.

⁵ Industrial Relations Reform Act 1993 (Cth), ss 170NA-NP.

⁶ Sees 5l(xx) of the Constitution, which grants the federal parliament power to make laws with respect to “foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth”. On the scope of the corporations power regarding industrial matters, see the recent decision Re Dingjan; Ex parte Wagner (1995) 128 ALR 81.

⁷ For some of the consequences of constructing enterprise flexibility (or Division 3)agreements on the corporations power, as opposed to the industrial power under s 51(xxxv) of the Constitution, see R Naughton, “The New Bargaining Regime Under the Industrial Relations Reform Act” (1994) 7 Aust J Labour Law 147 at 156-158.

⁸ Industrial Relations Reform Act 1993 (Cth), ss 170NA(l)(b) and 170NC(l)(a). See also Industrial Relations Act 1988 (Cth), s 3(a).

⁹ See eg KW Wedderburn, “Trust, Corporation and the Worker” (1985) 23Osgoode Hall LJ 203 at 250-251, noting that “[t]ransnational collective bargaining scarcely exists”; see also KW Wedderburn, above n 1 at 222. For a discussion of the problems enigendered by the corporate group structure, see H Collins, “Ascription of Legal Responsibility to Groups in Complex Patterns of Economic Integration” (1990) 53MLR 731.

¹⁰ K Stone, “The Post-War Paradigm in American Labor Law” (1981) 90 Yale LJ 1509 at 1511 and 1545. See also KW Wedderburn, “Trust, Corporation and the Worker”, above n 9 at 236, stating that collective bargaining is predicated upon “the conflicting interests of workers and employers” (original emphasis).

¹¹ (1993) 178 CLR 477.

¹² See generally J Hill, “Corporate Rights and Accountability - The Privilege Against Self�Incrimination and the Implications of Environment Protection Authority v Caltex Refining Co Pty Ltd” (1995) 7 Corp & Bus LJ 127.

¹³ See generally K Stone, “Labor and the Corporate Structure: Changing Conceptions and Emerging Possibilities” (1988) 55 U Chi L Rev 73.

¹⁴ JC Coffee, “Unstable Coalitions: Corporate Governance As A Multi-Player Game” (1990) 78 Geo LJ 1495 at 1496.

¹⁵ This parallels issues concerning protection of shareholder interests. See, generally, J Hill, “The Shareholder as Cerberus: Redefining the Shareholder's Role in Modern Australian Corporate Law” 1995 National Corporate Law Teachers Conference (Volume I) 7.

¹⁶ PS Atiyah, The Rise and Fall of Freedom of Contract (1979) at 398ff.

¹⁷ Ibid at 402-404.

¹⁸ On the argument that public power is always inherent in “private” arrangements, see M J Horwitz, “The History of the Public/Private Distinction” (1982) 130 U Pa L Rev 1423 at 1426; A J Jacobson, “The Private Use of Public Authority: Sovereignty and Associations in the Common Law” (1980) 29 Buffalo L Rev 600; W W Bratton, “The 'Nexus of Contracts' Corporation: A Critical Appraisal” (1989) 74Cornell L Rev 407 at 438-439.

¹⁹ On the dichotomy between rules and standards in limiting judicial discretion, see KM Sullivan, “Foreword: The Justices of Rules and Standards” (1992) 106 Harv L Rev 24 at 64, who states that “[r]ules embody a distrust for the decisionmaker they seek to constrain”. Rules are perceived to promote formal justice, whereas standards, by granting broader discretion to courts, are perceived to promote substantive equality and fairness.

²⁰ H C Katz, above n 3 at 7.

²¹ For criticism of the power of the “nexus of contracts” model of the corporation to privatise and legitimate the corporation, see W W Bratton, above n 18; D Millon, “Theories of the Corporation” [1990] Duke LJ 201; RM Buxbaum, “Corporate Legitimacy, Economic Theory, and Legal Doctrine (1984) 45 Ohio St LJ 515; G Teubner, “Enterprise Corporatism: New Industrial Policy and the 'Essence' of the Legal Person” (1988) 36 Am J Comp L 130 at 131. On legitimation in the industrial realm, see K Stone, above n 10 at 1525.

²² See, for example, P Selznick, Law, Society and Industrial Justice (1969) at 39-40; KM Sullivan, “Rainbow Republicanism” (1988) 97 Yale LJ 1713 at 1714 n 8. See also P I Blumberg,

²³ W Streeck, “Status and Contract: Basic Categories of a Sociological Theory of Industrial Relations” in D Sugarman and G Teubner (eds), Regulating Corporate Groups in Europe (1990) 105 at 106.

²⁴ (1989) 7 ACLC 841.

²⁵ According to Rogers AJA, an injured employee, while perhaps able to choose whether or not to be employed by a particular employer, in general has “no real input in determining how the business will be conducted and whether reasonable care will be taken” in matters of safety (ibid at 864). This parallels Max Weber's comment that “the formal right of a worker to enter into any contract whatsoever with any employer whatsoever does not in practice represent for the employment seeker even the slightest freedom in the determination of his own conditions of work” (quoted in W Streeck, above n 23 at 105).

²⁶ K Stone, above n 10; K Stone, “Re-Envisioning Labor Law: A Response to Professor Finkin”(1986) 45 Md L Rev 978.

²⁷ 0 Kahn-Freund, “On Uses and Misuses of Comparative Law” (1974) 37 MLR 1; R Romano, “A Cautionary Note on Drawing Lessons from Comparative Corporate Law” (1993) 102 Yale LJ 2021.

²⁸ See, generally, R Naughton, above n 7 at 150, 159 and 162 ff.

²⁹ C No 24187 of 1994 (Decision of the Full Bench, 1 March 1995). Cf, however, Re Aluminium Industry (Coma/co Bell Bay Companies) Award 1983 (1994) 56 IR 403 at 439-442, demonstrating the measure of ambivalence concerning the Commission's appropriate role under the new industrial regime.

³⁰ R Naughton, above n 7 at 165.

³¹ Industrial Relations Reform Act 1993 (Cth), s 170QK.

³² For different possible interpretations of good faith bargaining, see R Brownsword, “Two Concepts of Good Faith” (1994) 7 J Contract Law 197.

³³ See, for example, F H Easterbrook and DR Fischel, “Contract and Fiduciary Duty” (1993) 36 J Law & Econ 425.

³⁴ See DA DeMott, “Beyond Metaphor: An Analysis of Fiduciary Obligation” [1988] Duke LJ 879; V Brudney, “Corporate Governance, Agency Costs, and the Rhetoric of Contract” (1985) 85 Colum L Rev 1403.

³⁵ See generally J D Heydon, “Directors' Duties and the Company's Interests” in P D Finn(ed), Equity and Commercial Relationships (1987) 120. See also G Teubner, “Company Interest: The Public Interest of the Enterprise 'in Itself"' in R Rogowski and T Wilthagen (eds), Reflexive Labour Law (1994) 21.

³⁶ A A Berle, “Corporate Powers as Powers in Trust” (1931) 44 Harv L Rev 1049; EM Dodd,“For Whom Are Corporate Managers Trustees?” (1932) 45 Harv L Rev 1145; A A Berle, “For Whom Corporate Managers Are Trustees: A Note” (1932) 45 Harv L Rev 1365.

³⁷ G Teubner, “Corporate Fiduciary Duties and Their Beneficiaries: A Functional Approach to the Legal Institutionalization of Corporate Responsibility” in K Hopt and G Teubner (eds), Corporate Governance and Directors' Liabilities (1985) 149 at 150.

³⁸ Single-minded dedication to the pursuit of profit-maximisation is typified by Milton Friedman's famous statement that “[t]he social responsibility of business is to increase it sprofits”. See KW Wedderburn, “The Social Responsibility of Companies” (1985) 15 MULR 4.

³⁹ The modern “nexus of contracts” theory of the corporation, which views the firm as a legal fiction constituting a nexus for contractual relations between individual factors of production, embodies an aggregate approach. Although the nexus of contracts theory rejects the notion of shareholders as owners (characterising them as simply one of a number of suppliers of inputs), the theory, with its strong “private” focus, nonetheless generally accords predominance to their interests, as did Berle's model. See, for example, JR Macey, “An Economic Analysis of the Various Rationales for Making Shareholders the Exclusive Beneficiaries of Corporate Fiduciary Duties” (1991) 21 Stetson L Rev 23. See generally W W Bratton, above n 18 at 427; D Millon, above n 21 at 229-231.

⁴⁰ (1919) 170 NW 668.

⁴¹ “A business corporation is organized and carried on primarily for the profit of the stockholders ... The discretion of directors is to be exercised in the choice of means to attain that end, and does not extend to a change in the end itself, to the reduction of profits, or to the non-distribution of profits among stockholders in order to devote them to other purposes”. Ibid at 684.

⁴² E M Dodd, above n 36 at 1160. For a modern variation of this approach, see G Teubner above n 35 at 27 and 31.

⁴³ See, for example, A Chayes, “The Modern Corporation and the Rule of Law” in E S Mason (ed), The Corporation in Modern Society (1959) 25 at 41; P Selznick, The Moral Commonwealth: Social Theory and the Promise of Community” (1992) at 346-347.

⁴⁴ See generally D Millon, above n 21; W T Allen, “Our Schizophrenic Conc ption of the Business Corporation” (1992) 14 Cardozo L Rev 261; M J Horwitz, above n 18; GE Frug, “The City As a Legal Concept” (1980) 93 Harv L Rev 1057.

⁴⁵ Under this approach, the corporation's relationships with non-shareholder constituencies are relegated to other bodies of law such as labour law, anti-trust law etc. See D Millon, above n 21 at 202.

⁴⁶ For modern commentaries emphasising the public aspects of the corporation, see, eg,P Selznick, above n 22, ch 2; G Teubner, above n 21; RM Buxbaum, above n 21.

⁴⁷ EM Dodd, above n 36 at 1148.

⁴⁸ PI Blumberg, “Corporate Responsibility and the Social Crisis” (1970) 50 Boston UL Rev 157 at 161.

⁴⁹ “Modern large-scale industry has given to the managers of our principal corporations enormous power over the welfare of wage earners and consumers, particularly the former. Power over the lives of others tends to create on the part of those most worthy to exercise it a sense of responsibility”. EM Dodd, above n 36 at 1157.

⁵⁰ Dodd, however, later conceded that business obligations to employees had ultimately been accomplished by statutory rights rather than fiduciary duties. See J L Weiner, “The Berle�Dodd Dialogue on the Concept of the Corporation” (1964) 64 Co/um L Rev 1458 at 1463. Ironically, Berle considered subsequent history to have proven Dodd's thesis correct. Ibid at 1464.

⁵¹ Compare the position under German law where, although a mandatory duty was imposed early upon management to be socially responsible, lack of enforcement diminished it to a “norm without sanction”. G Teubner, above n 37 at 154.

⁵² K W Wedderburn, “The Legal Development of Corporate Responsibility: For Whom Will Corporate Managers Be Trustees?” in K J Hopt and G Teubner (eds), Corporate Governance and Directors' Liabilities (1985) 3 at 9.

⁵³ Hutton v West Cork Rly Co (1883) 23 Ch D 654 at 673.

⁵⁴ PI Blumberg, above n 48 at 176.

⁵⁵ [1962] Ch 927.

⁵⁶ Companies Act 1985 (UK), s 719. See also Companies Act 1955 (NZ), s 15A(l)(g).

⁵⁷ See, for example, Automatic Self-Cleansing Filter Syndicate Co Ltd v Cuninghame [1906] 2 Ch 34. See also J D Heydon, above n 35 at 125.

⁵⁸ Corporations Law, ss 160 and 161.

⁵⁹ KW Wedderburn, above n 9 at 230; see also LS Sealy, “Directors' 'Wider' Responsibilities - Problems Conceptual, Practical and Procedural” (1987) 13 Monash UL Rev 164 at 174.

⁶⁰ See, for example, Walker v Wimborne (1976) 137 CLR 1; Nicholson v Permakraft (NZ) Ltd (in liq) (1985) 3 ACLC 453; Kinsela v Russell Kinsela Pty Ltd (in liq) (1986) 4 ACLC 215; Jeffree v NCSC (1989) 7 ACLC 556. For developments in other jurisdictions, see J S Ziegel,“Creditors as Corporate Stakeholders: The Quiet Revolution - An Anglo-Canadian Perspective” (1993) 43 U Tor LJ 511.

⁶¹ See Kinsela v Russell Kinsela Pty Ltd (in liq) (1986) 4 ACLC 215 at 221.

⁶² Ibid at 223. See J Hill, “Duties of Directors Towards Creditors” (1986) 60 ALJ 525 at 527.

⁶³ “Where ... the interests at risk are those of creditors I see no reason in law or in logic to recognise that the shareholders can authorise the breach”: Kinsela v Russell Kinsela Pty Ltd (in liq) (1986) 4 ACLC 215 at 223.

⁶⁴ L S Sealy, above n 59 at 176-177 and 184. If the employee were also a shareholder, it is possible that a cause of action might lie under Corporations Law, s 260 by virtue of s 260(5)(b) and (c).

⁶⁵ JD Heydon, above n 35 at 131. See also Sycotex Pty Ltd v Baseler (1995) 13 ACSR 766 at 785.

⁶⁶ See Corporations Law, s 588G and its predecessor, Corporations Law, s 592. On developments in creditor protection, generally, see J Hill, “Corporate Groups, Creditor Protection and Cross Guarantees: Australian Perspectives” (1995) 24 Can Bus LJ 321.

⁶⁷ Companies Act 1985, s 309(1). Note, however, that under s 309(2), the duty is expressly stated to be owed to the company and enforceable as such.

⁶⁸ J E Parkinson, Corporate Power and Responsibility: Issues in the Theory of Company Law (1993) at 82. See also Fulham Football Club Ltd v Cabra Estates plc [1992] BCC 863 at 876 (CA).

⁶⁹ P G Xuereb, “The Juridification of Industrial Relations Through Company Law Reform”(1988) 51 MLR 156 at 158-159; see also L S Sealy, above n 59 at 177; KW Wedderburn,above n 9 at 235.

⁷⁰ PL Davies and KW Wedderburn, “The Land of Industrial Democracy” (1977) 6 ILJ 197 at 199.

⁷¹ K W Wedderburn, above n 9 at 250; see also F K Kubler, “Dual Loyalty of Labor Representatives” in K J Hopt and G Teubner (eds), Corporate Governance and Directors' Liabilities (1985) 429 at 438ff; C M Schmitthoff, “Employee Participation and the Theory of Enterprise” [1975] J Bus L 265.

⁷² See P L Davies and K W Wedderburn, above n 70 at 201, who argue that there is “no mechanism which will guarantee continuous, profit-maximising behaviour” by corporate controllers.

⁷³ (1843) 2 Hare 461.

⁷⁴ F K Kubler, above n 71 at 441-442.

⁷⁵ G Teubner, above n 37 at 152-153.

⁷⁶ W T Allen, above n 44 at 272ff.

⁷⁷ See D Millon, above n 21 at 234 and 25lff, discussing the decisions in Unocal v Mesa Petroleum Co 493 A 2d 946 (Del 1985) and Paramount Communications Inc v Time, Inc. [Del Supr] 571 A 2d 1140 (1989).

⁷⁸ see, generally, D Millon, ibid at 232ff. It has been argued that protection afforded to employees under these statutes was inadequate, since most statutes were permissive only and did not give employees standing to enforce the fiduciary duties. See K Stone, “Policing Employment Contracts Within the Nexus-of-Contracts Firm” (1993) 43 U Tor LJ 353 at 375; J W Singer, “Jobs and Justice: Rethinking the Stakeholder Debate” (1993) 43 U ,Tor LJ 475 at 505.

⁷⁹ R M Buxbaum, above n 21 at 515.

⁸⁰ See, for example, K Stone, “Employees as Stakeholders Under State Nonshareholder Constituency Statutes” (1991) 21 Stetson L Rev 45; K Stone, above n 78.

⁸¹ See S Fridman, “Super-Voting Shares: What's All the Fuss About?” (1995) 13Comp & Sec LJ 31 at 35, stating that Australian corporate law already recognises several classes of stakeholder in corporations.

⁸² C W Summers, “Codetermination in the United States: A Projection of Problems and Potentials” (1982) 4 J Comp Corp L & Sec Reg 155 at 170 (quoted in K Stone, above n 80 at 48- 49).

⁸³ See, for example, J R Macey, above n 39 at 26.

⁸⁴ Ibid; see also J R Macey, “Externalities, Firm-Specific Capital Investments, and the Legal Treatment of Fundamental Corporate Changes” [1989] Duke LJ 173.

⁸⁵ See, eg, K Stone, above n 80 at 54ff; K Stone, above n 78 at 375-377.

⁸⁶ See, eg, I Renard, “Commentary” in P D Finn (ed), Equity and Commercial Relationships (1987) 137 at 138, who argues in favour of shareholder primacy. Cf G K F Santow, “Defensive Measures Against Company Take-overs” (1979) 53 ALJ 374; B H McPherson, “Duties of Directors and the Powers of Shareholders” (1977) 51 ALJ 460 at 468.

⁸⁷ See also Corporations Law, s 461(e).

⁸⁸ See, for example, Ngurli Ltd v McCann (1953) 90 CLR 425.

⁸⁹ See, eg, Darvall v North Sydney Brick and Tile Co Ltd (1988) 6 ACLC 154 at 176; aff'd (1989) 7 ACLC 659; Pine Vale Investments Ltd v McDonnell and East Ltd (1983) 1 ACLC 1294; Harlowe's Nominees Pty Ltd v Woodside (Lakes Entrance) Oil Co NL (1968) 121 CLR 483.

⁹⁰ S Corcoran, “Managers and Majorities in Takeover Regulation” in G Walker and B Fisse (eds), Securities Regulation in Australia and New Zealand (1994) 759 at 765-766.

⁹¹ See, generally, LS Sealy, above n 59.

⁹² J D Heydon, above n 35 at 131ff.

⁹³ CSLRC, Enforcement of the Duties of Directors and Officers of a Company by Means of a Statutory Derivative Action (Report No 12, 1990).See also I Ramsay, “Corporate Governance, Shareholder Litigation and the Prospects for a Statutory Derivative Action” (1992) 15 UNSWLJ 149 at 165-166.

⁹⁴ CSAC, Report on a Statutory Derivative Action, July 1993, at 13-14.

⁹⁵ In the Australian context, see generally J Hill, “Institutional Investors and Corporate Governance in Australia” in T Baums, R M Buxbaum and K J Hopt (eds), Institutional Investors and Corporate Governance (1994) 583.

⁹⁶ See, generally, J Hill and I Ramsay, “Institutional Investment in Australia: Theory and Evidence” in G Walker and B Fisse (eds), Securities Regulation in Australia and New Zealand (1994) 289 at 29lff.

⁹⁷ For examples of aggressive institutional investor activism in Australia, see J Hill, above n 95 at 600ff.

⁹⁸ See, for example, M Lipton and SA Rosenblum, “A New System of Corporate Governance: The Quinquennial Election of Directors” (1991) 58 U Chi L Rev 187 at 189 arguing that the goal of corporate governance is to contribute to the long-term operating success of the corporation, which “will ultimately be the most beneficial to the greatest number of corporate constituents, including stockholders, and to our economy and society as a whole”.

⁹⁹ J Hill, above n 95 at 602-3.

¹⁰⁰ See, for example, R H Koppes, “Corporate Governance as a Key to Global Competitiveness”, Business Council of Australia and AIMG, Conference on Corporate Governance and Australian Competitiveness: The Role of Institutional Investors, Sydney, 1993.

¹⁰¹ See further below under “New Trends in Corporate Law”.

¹⁰² See discussion in K Stone, above n 78 at 375ff and K Stone, above n 13 at 152ff.

¹⁰³ See A Chayes, above n 43 at 41; J E Parkinson, above n 68 at 397-398.

¹⁰⁴ It might be thought that shareholders at least would be assured of participatory rights in corporate governance. Yet, the twentieth century has seen the gradual erosion of even shareholder participation. See R M Buxbaum, “The Internal Division of Powers in Corporate Governance” (1985) 73 Cal L Rev 1671; J Hill, above n 15.

¹⁰⁵ See, for example, J E Parkinson, above n 68 at 402ff; P L Davies, “Employee Representation on Company Boards and Participation in Corporate Planning” (1975) 38 MLR 254 at 256.

¹⁰⁶ KW Wedderburn, above n 9 at 248-249.

¹⁰⁷ P L Davies, above n 105 at 254. See also R Willis, Minister for Employment and Industrial Relations, 1984, Employee Participation News, No 3 at 8, supporting a programme of industrial democracy, embodying “the right of employees to influence decisions affecting their working lives”.

¹⁰⁸ See J E Parkinson, above n 68 at 406.

¹⁰⁹ It is clear that the idea of decentralised enterprise bargaining is itself designed to address some of these issues in order to enhance efficiency. So, too, is the removal of layers in the corporate hiercharchy, such as the dissipation of middle management.

¹¹⁰ See generally K J Hopt, “New Ways in Corporate Governance: European Experiments with Labor Representation on Corporate Boards” (1984) 82Mich L Rev 1338.

¹¹¹ G Teubner, above n 37 at 155.

¹¹² See, for example, K Stone, above n 13; P L Davies, above n 105; P L Davies and KW Wedderburn, above n 70.

¹¹³ See, for example, K W Wedderburn, above n 9 at 242; H Collins, above n 1 at 92; P L Davies, above n 105 at 255.

¹¹⁴ See PI Blumberg, “Employee Participation in Corporate Decision-Making” in A F Westin and S Salisbury (eds), Individual Rights in the Corporation (1980) 335 at 335ff, outlining the traditionally low level of interest in employee participation in the United States.

¹¹⁵ K Stone, above n 13 at 77, 126ff.

¹¹⁶ (1992) 10 ACLC 933 at 988. This distinction is less clearly made however in the Court of Appeal judgment in Daniels v AWA Ltd (1995) 16 ACSR 607.

¹¹⁷ Parallels have been made between the supervisory role of non-executive directors under a unitary board system and the separation of management and supervisory boards under the two-tier German board system. See K J Hopt, “Directors' Duties to Shareholders, Employees, and Other Creditors: A View From the Continent” in E McKendrick (ed),Commercial Aspects of Trusts and Fiduciary Obligations (1992) 115 at 117.

¹¹⁸ J Hill, n 66 at 350; see also G Teubner, “The Many-Headed Hydra: Networks as Higher-Order Collective Actors” in J McCahery, S Picciotto and C Scott (eds), Corporate Control and Accountability: Changing Structures and the Dynamics of Regulation (1993) 41.

¹¹⁹ See, generally, J E Parkinson, above n 68 at 408-409.

¹²⁰ See G Teubner, “Industrial Democracy Through Law? Social Functions of Law in Institutional Innovations” in T Daintith and G Teubner (eds), Contrac.t and Organisation: Legal Analysis in the Light of Economic and Social Theory (1986) 261 at 263-264.

¹²¹ For a description of some typical conflict situations, see F K Kubler, above n 71. See also J Hopt, above n 117 at 118-119; K stone, above n 110 at 1359-1362; KW Wedderburn, above n 9 at 236ff.

¹²² (1967) 87 WN (Pt l)(NSW) 307.

¹²³ K J Hopt, “Self-Dealing and Use of Corporate Opportunity and Information: Regulating Directors' Conflicts of Interest” in K J Hopt and G Teubner (eds), Corporate Governance and Directors' Liabilities (1985) 285 at 308-309; see also K Stone, above n 13 at 148ff.

¹²⁴ See, eg, Levin v Clark [1962] NSWR 686; Re Broadcasting Station 2GB Pty Ltd [1964-65] NSWR 1648; Berlei Hestia (NZ) Ltd v Fernyhough [1980] 2 NZLR 150.

¹²⁵ Report No 8, Nominee Directors and Alternate Directors (1989).

¹²⁶ R Naughton, above n 7 at 156ff.

¹²⁷ Section 170NA(l)(b).

¹²⁸ Section 170NC(l)(a).

¹²⁹ K Stone, above n 13 at 120.

¹³⁰ R Naughton, above n 7 at 151.

¹³¹ K J Hopt, above n 110 at 1348. Cf K Stone, above n 13 at 162, who argues that “[p]articipation is collective bargaining in another form”.

¹³² see discussion by K Stone, Ibid at 79-81

¹³³ Ibid at 82.

¹³⁴ See, generally, K Stone, above n 13.

¹³⁵ Note, however, that shareholder consent is increasingly used as a regulatory technique under the Corporations Law. See, generally, J Hill, above n 15. See also AIMA, A Guide for Investment Managers & A Statement of Recommended Corporate Practice Gune 1995) at 29, supporting employee share schemes on the basis that they improve employee relations by�communicating to employees through the channels normally reserved for shareholders”.

¹³⁶ For a description and assessment of some of the main employee share plan types, see G Fitton and G Price, Employee Share Planning in Australia (1990), ch 2. See also J E Parkinson, above n 68 at 423-426.

¹³⁷ See “Foreign investors: Would they just fade away like Alice's cat?”, Company Director,August 1990, 6.

¹³⁸ G J Dusseldorp, “Preliminary Note for Employee Share Planners”, in G Fitton and G Price, above n 136.

¹³⁹ For developments on “pass-through” voting in the United States context, see P I Blumberg, above n 114 at 345ff.

¹⁴⁰ Occupational Superannuation Funds are far more highly regulated than employee share plans. There are, for example, stringent restrictions on the level of in-house investment permitted by occupational superannuation funds. On equal employee representation on the trustee board for such funds, see J Hill, above n 95 at 592-594; Butterworths, Australian Superannuation Practice: Commentary, Prudential Standards, 70,351ff. See also J E Parkinson, above n 68 at 400.

¹⁴¹ In the United States context, see K Stone, above n 13 at 121-126; D G Olson, “Union Experiences With Worker Ownership: Legal and Practical Issues Raised by ESOPS, TRASOPS, Stock Purchases and Co-operatives” [1982] Wis L Rev 729.

¹⁴² “Pay For Performance: What's It All About”, Equity Strategies Report, May 1995.

¹⁴³ United States companies include Pepsi Co and Du Pont and English companies include Wellcome and ALPHA Airports Group.

¹⁴⁴ See, generally, “Pay For Performance: What's It All About”, above n 142. See also Department of Industrial Relations, Sharing Profits and Growth (1988).

¹⁴⁵ Department of Industrial Relations, ibid at 15.

¹⁴⁶ See Australian Tax Practice, Bills Explanatory Memoranda, 12 April 1995, at 269. There is also a requirement that the employee does not hold more than 5 per cent of shares in the company.

¹⁴⁷ See G Fitton and G Price, above n 136 at 3. See also AIMA, Appendix B, above n 135 at 29.

¹⁴⁸ See also Department of Industrial Relations, Financial Participation by Employees: A Review of Theoretical and Practical Issues, DIR Research Paper No 8 (1988) at 6-7.

¹⁴⁹ See, generally, J Hill, above n 95 at 584ff.

¹⁵⁰ Introduced from 1 July 1992.

¹⁵¹ ALRC and CSAC, Report No 59, Collective Investments: Superannuation, 31 March 1992, lix.

¹⁵² Evidence of Association of Superannuation Funds of Australia representative, Senate Select Committee on Superannuation, at 643. As such, the scheme appears to place Australia within Robert Clark's fourth stage of capitalism, in which the savings-decision function is appropriated by the government. See R C Clark, “The Four Stages of Capitalism: Reflections on Investment Management Treatises” (1981) 94 Harv L Rev 561 at 565-566.

¹⁵³ See Sherry Committee, Safeguarding Super: The Regulation of Superannuation (1992) at paras [2.51]-[2.52]; V W Fitzgerald, Australians' Superannuation Savings: Nest Egg or Honey Pot? (1991) at 44; L Hall, “Where Will the Superbillions Be Invested in the 1990s?”, 20th Conference of Economists, Hobart, 1991.

¹⁵⁴ The ultimate goal is for every employee to have total superannuation payments of 15 per cent of their pay by 2002. See “Welcome to the latest Super revolution”, Sydney Morning Herald, 10 May 1995 at 1.

¹⁵⁵ On fund flows and investment patterns generally, see R M Buxbaum, “Institutional Owners and Corporate Managers: A Comparative Perspective” (1991) 57 Brooklyn L Rev 1; J Hill, above n 95 at 584ff.

¹⁵⁶ See, generally, J Hill and I Ramsay, above n 96 at 291ff.

¹⁵⁷ Ibid, Table 1 and Table 2, for statistical information regarding changes in investment patterns and levels of institutional investment in Australian companies.

¹⁵⁸ R M Buxbaum, above n 155 at 28.

¹⁵⁹ For recent examples of activism by Australian institutional investors, see J Hill, n 95 at 600ff. The events at Coles Myer are the latest in this trend.

¹⁶⁰ See P L Davies, “Institutional Investors in the United Kingdom” in D D Prentice and P RJ Holland (eds), Contemporary Issues in Corporate Governance (1993) 69 at 69.

¹⁶¹ See RM Buxbaum, above n 155 at 28-29.

¹⁶² See above n 140. On the issue of institutional investors' legitimacy, see RM Buxbaum, ibid at 40-41, 45; J Hill, above n 95 at 593ff.

¹⁶³ See comments by RM Buxbaum in RM Buxbaum, T Hertig, A Hirsch and K J Hopt (eds),European Business Law: Legal and Economic Analyses on Integration and Harmonization (1991) at 259-260.