An accumulation of knowledge has its disadvantages, particularly in a volatile subject like Company Law where the “established” easily becomes the “supplanted”. Or it may be the result of advanced age dulling the author’s sharpness of perception. Whatever the reason, delay in committing thoughts to paper was the result.
The unit of the share is central to the operation of regulatory structure that we know as Company Law (or, if we wish to be modern in our use of discourse, “Corporate Law”). With the pace of globalisation and the apparently inexorable process of convergence in Company Law, that statement of the position is incontrovertible for virtually every developed legal system in the world. In modern parlance, the share has “gone viral”. That said, very often we make assumptions about our understanding of what a company share is. In university degree courses on Company Law in the UK our perception of the company share sometimes operates at close to subliminal level. Aspects of the specific rules dealing with company shares are often treated on a fairly random basis – so, for instance, they appear on any discussion of share capital maintenance, corporate constitution, powers of directors, rights of minority shareholders and takeovers, to name but a few topics. But generally, there is little time allocated for an holistic analysis of this pivotal feature of Corporate Law.
The new text that is the subject of this blog charts the changing patterns of regulation insofar as they affect shares. It considers the extent to which shareholder rights in the UK have been altered in recent years, particularly in the wake of the Companies Act 2006 and the subsequent copious amending legislation. The historical overview of the company share over the long term is examined. Certain cultural and political ramifications of the share require explanation. The diversity that exists within the family of shares is described. Traumatic changes in the life of the share from privatisation to nationalisation are noted. We have had to accept the fact that the share has become the leading player in the world of intangible assets in which we live and that reality required comment. Some speculation (and it can be no more than that) on the implications of “Brexit” is entered into. Other potential future developments that might affect the standing of the company share are highlighted. The implications of blockchain technology are raised, but the truth of the matter is that at the moment no one knows where that development will lead. The text also seeks to reflect on the impact of public policy on the law relating to company shares. It highlights the tension that exists between the legitimate expectations of private property ownership in respect of the holding of shares and the requirements of public interest which may require “regulatory takings”.
Skipping to the conclusion the text argues for a release of the untapped potential of company shares by widening share ownership and innovative usage of the share to finance public undertakings which are strapped for capital. The need to adapt is paramount if the institution of the share is to survive for the next 100 years. It is pleasing to see that radical thinking on the question of shares is at present exercising the minds of politicians; witness the proposals put forward at this years' Labour Party Conference on the enforced creation of share schemes for the benefit of employees. This will generate lively discussion in the area.
A number of individuals (both at Lancaster and beyond) offered assistance and valuable insights in their discussions with the author. Thanks are due to these individuals; without their support completion would have been further delayed. Needless to say, the views of these academics on every issue raised did not always coincide, but discussion with these scholars proved invaluable. The author would like to acknowledge the support of the University of Lancaster for making available paid research leave in Michaelmas term 2017/18 to facilitate the completion of this project.