"In a large listed company, there are no effective restrictions on the conduct of the directors compelling them to behave in the interests of shareholders or 'stakeholders'" - Discuss.

... LX2030 COMPANY LAW COURSEWORK Part A (d) "In a large listed company, there are no effective restrictions on the conduct of the directors compelling them to behave in the interests of shareholders or 'stakeholders'." Discuss. As the number of shareholders increases within a company, it is almost impossible for all the shareholders to be involved in the management of the company's affairs. Thus, the shareholders become increasingly distant from the daily affairs of the company which not only makes it difficult to control managerial excess, but it also makes difficult ensuring that directors act in the interests of shareholders. Berle and Means identified that this gives management a greater level of freedom than they should have in theory to pursue objectives, which are inconsistent with the interests of shareholders interests. This notion has been a recent issue in the UK corporate governance cases and caused debate over whether there are any effective restrictions which

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