COMPANY MANAGEMENT

New Zealand Herald, Volume LXXI, Issue 21925, 8 October 1934, Page 12

COMPANY MANAGEMENT

Sir, —One fact emerges very clearly from the late discussion on company directors' responsibility toward shareholders, and that is the crying need for reform. The first of these reforms should be the appointment, -by the general body of shareholders in any company, of a special business representative who should not be a director, but be entitled to attend all directors meetings on behalf of the shareholders. No important' ;;cheme involving jib cutlay of the investors' money should be proceeded with until this representative has been given the opportunity to lay the scheme before the shareholders and thoroughly explain its meaning and possible consequences. After a thorough ventilation of the matter, shareholders may, by a threefourths. majority, empower their representative to veto or egree to such proposals. Thus the oniis is on themselves if the scheme is not a successful one. This proposal, which I pui before a company secretary, received the renly from him: "If Company Law was tightened up like that there would be no companies formed." But is not this a very damaging admission ? Isabel M. Cltjett.