The theoretical basis of commercial law, corporate governance law, and corporate law is still unsatisfactory. There essentially is no theory of commercial law, and existing theories of corporate governance and corporate law cannot explain the behaviour of firms or the contents of existing regulation. This book proposes a coordinated solution for all three areas. The starting point is that all three areas deal with the organisation of firms. Commercial law, corporate governance, and corporate law are therefore studied from the perspective of the firm rather than that of the judge or the investor. Changing the perspective makes it easier to formulate an "umbrella" theory of commercial law, and theories of corporate governance and corporate law as applications of the main theory. The book provides examples of how the proposed theories work by studying legal corporate governance tools and practices that increase the sustainability of the firm. Sustainability can be bolstered by making the governance model more self-enforcing and ensuring that it fosters innovation.
Organising the Firm . Petri M€antysaari Organising the Firm Theories of Commercial Law, Corporate Governance and Corporate Law Prof. Dr. Petri M€antysaari Hanken School of Economics Department of Accounting and Commercial Law Handelsesplanaden 2 65100 Vaasa Finland
[email protected] ISBN 978-3-642-22196-5 e-ISBN 978-3-642-22197-2 DOI 10.1007/978-3-642-22197-2 Springer Dordrecht Heidelberg London New York Library of Congress Control Number: 2011937439 # Springer-Verlag Berlin Heidelberg 2012 This work is subject to copyright. All rights are reserved, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilm or in any other way, and storage in data banks. Duplication of this publication or parts thereof is permitted only under the provisions of the German Copyright Law of September 9, 1965, in its current version, and permission for use must always be obtained from Springer. Violations are liable to prosecution under the German Copyright Law. The use of general descriptive names, registered names, trademarks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. Printed on acid-free paper Springer is part of Springer Science+Business Media (www.springer.com) Contents 1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 2 Economic Theories of the Firm . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1 General Remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2 Production Function . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3 Governance Structure or Organisational Construction . . . . . . . . . 2.4 Personification of the Firm, Authority . . . . . . . . . . . . . . . . . . . . 2.4.1 General Remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4.2 Personification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4.3 Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 5 6 7 8 8 8 11 12 3 Theory of Commercial Law: Past Approaches . . . . . . . . . . . . . . . . 3.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2 Research