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Working paper

Corporate Governance Legal Issues

This paper aims to add to literature on the connection between corporate governance and corporate law development. “Corporate governance” came into vogue in the 1970s in the United States. It had become the subject of debate worldwide by scholars, regulators, investors etc. This paper considers the nature and extent of corporate law`s contribution to the development of corporate governance and vice versa. In recent years, Russia and most continental countries (Germany, France, Italy) have enacted significant corporate law reforms. In Europe these reforms aim to strengthen the mechanisms of internal governance, empower shareholders, enhance disclosure requirements, and toughen public enforcement, which are the most effective tools for countering abuses by dominant shareholders. It is widely discussed among legal professionals in Russia that there is now an urgent need for a comprehensive review and modernization of corporate law and governance. However, in the last two years the Russian Civil Code and Federal Law “On Joint Stock Companies” have been changed deeply. Under the new Civil Code, all legal entities (both commercial and non-commercial) are divided into corporate and unitary entities.