Melbourne Law School - Theses
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ItemRegulation of executive remuneration: an empirical study of the first three years of a 'disclosure and voting' regime in Australia and the UK( 2010)Legislation by the UK government in 2002 and the Australian government in 2004 sought to improve board accountability for executive remuneration practices in listed companies. The thesis examines whether the remuneration report plus an advisory vote were effective in achieving this and other government policy aims (such as reducing excessive remuneration and aligning pay with performance). The thesis focuses upon the initial three years of this regime in the UK (2003-2005) and Australia (2005/06-2007/08). Part I of the thesis reviews three theories of motivation from the human resource management literature, together with two derivatives of agency theory (optimal contract and the managerial power thesis) to justify executive remuneration practices and the need for it to be regulated. Drawing upon the concept of ‘regulatory space’ and Julia Black's writings on rule dimension and regulatory conversation, the thesis presents a conceptual model of the regulatory framework for executive remuneration: the regulated remuneration cycle consisting of four activities (remuneration practice, disclosure, engagement and voting). Close analysis of the rule types, regulators and regulatees within this regulated remuneration cycle demonstrates that most of the rules found in the cycle take the form of statements of best practice, or other kinds of ‘soft law’, rather than legislation. Thus enforcement of good remuneration practices does not rely upon legal sanctions. The enforcement pyramid for remuneration practice confirms that most of the enforcement strategies for remuneration practice belong to shareholders. However, the regulated remuneration cycle exposes the three roles that shareholders play within this regulatory space: a rule-maker for executive remuneration practice, an active engager of remuneration committees and a routine voter on remuneration-related resolutions. Part II presents qualitative and quantitative empirical evidence of the operation of the remuneration report and advisory vote in both jurisdictions. It analyses remuneration reports and voting results for a sample of companies from the FTSE 100 and the S&P/ASX 200 for the first three years. It supplements this publicly available information with interview evidence from remuneration committees and their consultants, institutional investors and institutional representative organisations. By analysing the rules for each of the four activities in light of the evidence of how they work in practice, it demonstrates the challenges facing remuneration committees and institutional investors in working within the regulated remuneration cycle. Using the advisory vote as a proxy for shareholder outrage, it demonstrates the effect that the vote had on remuneration practice over the first three years of its operation was not identical in the UK and Australia. Part III concludes the thesis by presenting six findings on the operation of the regulatory initiatives of the remuneration report and advisory vote. These reforms were only partially successful in improving board accountability and unsuccessful in reducing excessive remuneration over the first three years of its operation. The implications of these findings for the regulatory reforms enacted in response to the global financial crisis are noted.
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ItemAutomating the internet: the law of electronic commerce, contracts and autonomous software agents: regulation of Agent-mediated online contracting: enforceability, liability and risk allocation( 2002)This thesis enquires into the regulation of online contracts formed by autonomous, artificially intelligent software programs, called 'Agents'. It provides an overview of the current state of the law as applied to Agents that negotiate and transact online. Agent transactions are fundamentally different from other computerised transactions, as Agent actions are autonomous, proactive and informed by their ‘intelligence’ and ‘experience’. This paper focuses on three specific areas: (a) the extent to which Agent-generated contracts are, and should be, enforceable; (b) the liability of parties involved in Agent transactions; and (c) the manner in which risk is, and should be, allocated in respect of errors involved in the use of contracting Agents. In exploring these key areas, this thesis considers whether or not the current law adequately deals with Agent-mediated contracts. Areas in which the law fails to satisfactorily resolve issues of enforceability, liability and risk allocation are highlighted, and modifications and reform necessary to achieve such resolution are suggested. This thesis commences with a review of the technical aspects of Agent software, and identifies characteristics that differentiate Agents from other software. We then examine legal doctrine that may be invoked, in current or modified form, to govern Agent contracting activity. Principles of contract law, agency law, and legislative schemes are analysed to ascertain the extent to which they apply to Agent-mediated contracts. In evaluating the operation of contract law, principal-agent law and legislative initiatives, the benchmark against which proposed methods of regulating Agents are measured is the extent to which a particular approach facilitates electronic comerce by providing a strong legal infrastructure. In summary, this thesis: (a) defines and characterises software Agents and discusses e-commerce scenarios in which Agents are, and could be, utilised; (b) reviews principles of contract and agency law, as well as e-commerce legislation, analysing their application to online Agent contracting activity; (c) identifies areas where the law fails to adequately govern Agent-mediated contracts; and (d) suggests ways in which the law may more effectively regulate this new sphere of contracting activity.
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ItemSuperannuation: a public trust( 2002)Superannuation funds in Australia were originally established in an occupational environment and administered as private trusts. Superannuation funds are also collective investment schemes and, as such, can have commercial overtones. This thesis demonstrates how the judiciary and the government have both strained and extended private trust law in order to accommodate the distinctive features of the superannuation trust. Chapter 2 examines some of the tensions with traditional trust law by undertaking a survey of case law dealing with disability benefits. A detailed analysis of the statutory scheme contained in the superannuation legislation is undertaken in chapter 3. Chapter 4 will examine the impact of imposing 'merits review' - an administrative law mechanism - on private trustees. These developments suggest that superannuation trustees perform a public function. Yet the private form and source of superannuation benefits indicate that it is inappropriate to simply replace trust law standards with administrative law standards, unless it can be said that superannuation trustees now operate in the public domain. This question is explored in chapter 5 and analogies are drawn with the more public charitable trust. It is concluded that both the charitable trust and the superannuation trust operate within a hybrid 'public service' sector. A unique public model must therefore be formulated. Chapters 6 and 7 propose the specific features of the hybrid public model for superannuation trusts. Modifications to the current legal regime are identified in order to bolster the tentative trend in this direction. It is submitted that this public model offers a solution to the dilemmas currently encountered in conceiving a juristic framework for the modern superannuation trust in Australia.
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ItemThe continued application of source-based taxation in an electronic commerce environment( 2002)The advent of electronic commerce has caused many to question the continued viability of sourced-based taxation. Characteristics of electronic commerce include the expected reduction in the need for certain intermediaries in the business process, as well as the borderless and intangible nature of the Internet, which allows a business to earn income without it having to maintain a physical presence in the market territory. In light of these characteristics it is not difficult to see how arguments calling for the abandonment of source-based taxation continue to be raised. While the thesis accepts these observations as being valid, nevertheless it will be argued that source-based taxation is theoretically justifiable for income that arises from international transactions which are conducted in an electronic commerce environment. However, it will also be argued that the way in which the source of income is defined needs to be reconceptualised because the application of source-based taxation under traditional principles may be rendered problematic in light of certain characteristics of electronic commerce that are significant from a tax perspective. In summary, three main outcomes will emerge from this research, which flow from the arguments undertaken in the thesis: 1. Source-based taxation is theoretically justifiable for income that arises from international transactions which are conducted in an electronic commerce environment. The implication of this assertion is that source-based taxation of electronic commerce transactions should continue. 2. The way in which source is currently defined for electronic commerce transactions needs to be reconceptualised because of certain characteristics of electronic commerce that are significant from a tax perspective. 3. Various models for this reconceptualisation can be considered and three possible models will be examined and analysed for this purpose.