Who company directors are really beholden to
Geoff Edwards: Re. “Tax evasion teeters in the too-hard basket” (yesterday). Myriam Robin in Thursday’s epistle observed that “Company directors have a legal obligation to act in the best interest of their shareholders.” Sorry to disagree, Myriam. This defence is commonly asserted by companies to justify various activities that are contrary to the public interest. Strictly, it is not true. Directors have a legal obligation to act in the best interest of the corporation, which is not the same as the shareholders.
The shareholders by and large are anonymous, passive recipients of dividend cheques, with individual legal identities, but whose stake in the company ranks behind the tax office, employees and sundry other creditors. The corporation on the other hand has a public face, a reputation to uphold, and an obligation to government to behave in a civically appropriate manner. The corporation exists only by favour of the government that registers it. The notion that governments grant corporations the right to exist only to act as conduits to funnel wealth from the pockets of customers to the shareholders is anti-intuitive. In essence, the government creates corporations to provide goods and services for the public benefit and the financial returns to shareholders are a means to that end.
No mercy for Clover
Martin Vukoja writes: Re. “Moore vs Tele thaws?” (yesterday). Highly unlikely that The Daily Telegraph is adopting a gentler approach to Sydney’s Lord Mayor. The editorial line in the Tele — which is generally reflected on its news, opinion and letters pages — is still reliably and virulently anti-Clover. Just this past Tuesday, a thundering editorial referred to her as a propagandist and “delusional”. Rest assured, the strained relationship between the two remains as “complicated” as ever.
No such thing as a free movie
2014-2015 Australian Children’s Laureate and 2015 Senior Australian of the Year Jackie French writes: Re. “Dallas Buyers Club: how the gays have been co-opted for profit” (yesterday). When a cafe makes me a cup of coffee they expect me to pay for it. Those who create films or books have a right to be paid for their creations too. When we all get free coffee, cars, and tooth repair, I’ll consider renouncing copyright too.