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LAWS6133 Corporate Governance - Shareholders' Rights and Responsibilities

Module Overview

The core relationship in corporate governance is between the board of directors and the shareholders and this module focuses on shareholders’ rights and responsibilities in publicly traded companies. Post the financial crisis, the focus of attention has fallen on shareholders as one of the essential gatekeepers in corporate governance. This 7.5 ECTS/15 CATS module looks at the role of shareholders in the publicly traded company. These are now widely dispersed and held mainly by overseas shareholders holding through elaborate cross-border investment chains which raise real legal difficulties in terms of even identifying who are the shareholders. There are questions as to shareholder power and voting rights, especially, and as to appropriate voting structures. Linked to ownership is the core issue of engagement as shareholders are forced by regulators into a stewardship role. An examination and evaluation of that stewardship role is central to this module. The core issue throughout is the question of corporate purpose in the 21st century and whether shareholder primacy can prevail.

Aims and Objectives

Module Aims

• to give you a sound knowledge and understanding of the legal issues surrounding share ownership and shareholder engagement in traded companies; • to enhance your understanding of the investment chain and the roles played by the various intermediaries along the chain and the nature of the legal relationships along it; • to appreciate the policy debate surrounding the issue of shareholder primacy - shareholders v stakeholders and the question of corporate purpose in the 21st century, post the financial crisis; • to provide you with an understanding of the role which shareholders play and can be expected to play in listed companies by the exercise of their voting power in general meetings; and the relevant voting structures; • to enable you to develop their powers of legal analysis through a critical examination of the policy objectives of the law in this area and to assess the value of the current emphasis on stewardship by shareholders and whether shareholders have effective mechanisms for holding directors to account.

Learning Outcomes

Knowledge and Understanding

Having successfully completed this module, you will be able to demonstrate knowledge and understanding of:

  • the nature of share ownership and the rights and responsibilities which go with that ownership;
  • the investment chain with dematerialised shares held through length cross-border chains of intermediaries, the nature of those relationships and the consequences for concepts of ‘ownership’;
  • the disclosure of beneficial ownership; voting powers and structures;
  • the rights of shareholders in terms of shareholder primacy - the shareholder v stakeholders debate and the question of corporate purpose in the 21st century, post the financial crisis;
  • the Stewardship Code and the evolving requirements for investor engagement to hold directors to account for their management of the business.
Subject Specific Intellectual and Research Skills

Having successfully completed this module you will be able to:

  • analyse legal materials, identify key legal principles and issues and, where appropriate, make constructive criticism;
  • critically evaluate legal materials by way of textual and case analysis, review of journal articles and consideration of reform reports from bodies such as the European Commission and the UK Government;
  • critically assesses the strengths and weakness of shareholder ownership and engagement in traded companies and the steps taken to strengthen shareholder control of boards of directors;
  • communicate effectively knowledge of issues of shareholder rights and responsibilities in the traded company and present reasoned arguments coherently.
Transferable and Generic Skills

Having successfully completed this module you will be able to:

  • analyse and interpret complex legal materials, including soft law materials;
  • analyse and interpret complex policy reports;
  • evaluate legal materials and effectively apply them to practical corporate problems;
  • develop and present written arguments supported by appropriate evidence.


The syllabus will focus upon: • The nature of shares and share ownership – the changing composition of shareholders as a class, (individuals, institutions, domestic, international) and the implications this has for shareholders’ rights and roles; • Issues surrounding the investment chain – the dematerialisation of shares – the use of intermediaries – the nature of the relationships along the investment chain – issues of legal certainly surrounding the transfer of ownership with the chain – whether relationships contractual or fiduciary; • Disclosure of beneficial ownership –- voting powers and structures; • Shareholder primacy – in whose interests should companies be run ? • Shareholders as stewards – the Stewardship Code and the ‘obligation’ of engagement – legal framework governing general meetings and voting rights – ability of shareholders to hold directors to account in listed public companies.

Learning and Teaching

Teaching and learning methods

Teaching methods include: • Weekly seminars, led by individual student presentations with opportunities for group presentations (the balance between individual and group presentations will depend on the number of students in the module). Learning methods include: • Directed reading, as per distributed reading lists; • Additional reading as provided on Blackboard

Independent Study130
Total study time150

Resources & Reading list

Mayer (2013). Firm Commitment: Why the Corporation is Failing Us and How to Restore Trust in It. 

Stout (2012). The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations and the Public. 



Class discussions


MethodPercentage contribution
Examination  (1.5 hours) 100%


MethodPercentage contribution
Examination  (1.5 hours) 100%


MethodPercentage contribution
Examination  (1.5 hours) 100%

Repeat Information

Repeat type: Internal & External


Costs associated with this module

Students are responsible for meeting the cost of essential textbooks, and of producing such essays, assignments, laboratory reports and dissertations as are required to fulfil the academic requirements for each programme of study.

In addition to this, students registered for this module typically also have to pay for:

Printing and Photocopying Costs

There are few cost implications – the students are able to assess all the materials on Blackboard but may incur some limited photocopying costs because they may want to have copies of some documents, such as the UK Stewardship Code for individual study. The library resources in Company law generally are adequate to provide background materials and reading generally.


Recommended texts for this module may be available in limited supply in the University Library and students may wish to purchase the mandatory/additional reading text as appropriate.

Please also ensure you read the section on additional costs in the University’s Fees, Charges and Expenses Regulations in the University Calendar available at

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