Theses and Dissertations
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Browsing Theses and Dissertations by Author "Nwafor, A. O."
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Item Open Access A critical appraisal of the creditor protective mechanisms under the South African Companies Act 71 of 2008(2019-05-18) Sibanda, Mandlaenkosi; Nwafor, A. O.; Letuka, P.This research examined the mechanisms that were employed by the Companies Act 71 of 2008 in order to protect the interests of creditors in company affairs. At the preamble of the aforementioned Act lies an undertaking from legislature to provide appropriate redress to investors and third parties/creditors. It was on that basis that the researcher sought to establish whether legislature had indeed fulfilled its commitment to provide appropriate redress to creditors. Traditionally, companies have been run to promote the interests of shareholders with little attention given to the interests of other stakeholders such as creditors. It is this research`s findings that South African company law has moved from the traditional view, that is the shareholder value approach, to the enlightened shareholder value approach: a model of corporate governance which permits directors to have regard, where appropriate, to the interests of other stakeholders but with shareholders’ interests retaining primacy. It is thus found that creditors cannot be protected by contract laws alone but that their protection should be enhanced by mandatory corporate laws which regulates the manner and conduct of company controllers in a way that ensures that the interests of all stakeholders, including creditors, are given due regard. Finally, it has been found that much work has been done by legislature in developing the re-enacted creditor protective mechanisms and also in statutorily adopting new mechanisms which are aimed at advancing creditor interests. Recommendations have thus been made to legislature for possible amendments to refine its corporate laws.Item Open Access Exploring The Concept of Unfairly Prejudicial Conduct as A Minority Shareholder Remedy Under the South African Company Law(2021-04) Mathabi, Livhuwani; Nwafor, A. O.; Selala, K. J.The South African Constitution recognises freedom of association. Generally, persons associate to form a company, but not all those that form a company are involved in the management of a company. Instead, management decisions are taken by the board of directors, and in some cases by the majority shareholders. It is a well-known principle that when one intends to be a shareholder in a company, he/she agrees to be bound by the decisions of the board or the majority of the members. In the corporate world, the directors of a company are faced with decision-making on a daily basis. Some of these decisions may not be favourable to the interests of the minority shareholders and the company. However, the law insists that only the company, through the board or the majority shareholders, can seek relief. That is the stringent common law rule in Foss v Harbottle. The quest to mitigate the burden placed on the minority shareholders by the application of that rule has led to the evolution of the remedy against oppression, which is now codified in section 163 of the Companies Act 71 of 2008. This research examines the efficiency of section 163 of the Companies Act 71 of 2008 in ensuring the protection of minority shareholders’ interests with regards to unfair and oppressive conducts of the majority in the conduct of a company’s affairs. The researcher adopted a doctrinal approach in this work, which requires a focus on existing literature to discover the extent to which the interests of the minority shareholders are protected in a company’s affairs. A comparison is made between the South African Companies Act provision in section 163 and that of the other countries as well as judicial pronouncements in these jurisdictions, to determine the advances which the South African law has made in affording protection to minority shareholders beyond the common law precept.Item Open Access The making of right choices between shareholders and stakeholders in corporate operations in South Africa(2019-05-18) Kimbini, Ophellia; Nwafor, A. O.; Simbo, C.For a considerable period of time the primary goal of corporations was seen as being to increase the wealth of the investors (shareholders). Priority was given to shareholders’ profit maximisation at the very expense of stakeholders` interests in corporate governance. Stakeholders` interests were seen to be falling outside the range of the needs and objectives of the corporate world. However, in contemporary times, schools of thought have emerged which proposed that the corporations should not solely focus on maximising profit for the benefit of shareholders but should consider the interests of stakeholders in the management of their affairs. This issue has attracted enormous debate and arguments have been brought forward to support the view that those in management positions should consider stakeholders` interests in the corporate governance. However, there is no unanimity among scholars on what should be the right approach. It is against this backdrop that the study therefore assesses how companies are practically run in order to determine whether the interests of stakeholders are considered in corporate governance as much as they should. This dissertation explores, through doctrinal and empirical methods, the conflicting theories and existing debates on corporate governance and to show that it is for the good of the company as an entity that there be equal recognition and treatment of the two groups of the competing interests in corporate operations. The research employed the doctrinal research approach in order to evaluate the positions advocated by the different schools of thought as well as to give a comparative analysis of the position of the law in cognate jurisdictions on this matter. The empirical research approach, through questionnaires, was used to collect qualitative data from different stakeholders of different categories of chosen companies in order to ascertain from the perspective and actual experiences of stakeholders the extent to which companies consider the interests of stakeholders. The research established that, in the main, companies do not consider the interests of stakeholders and in cases where they do, the interests of shareholders are still dominant to those of stakeholders. Recommendations are made from inferences drawn from the study on how to guarantee an enhanced protection of the stakeholders’ interests in the corporate scheme.