EVOLUTIONARY PROCESS OF COMPANY LAW AND EVOLVEMENT OF CORPORATE GOVERNANCE

Abstract

The business role in the economic and social development of a country has been recognized as vital worldwide where, the belief is, the business success translates into the economic well-being of the ‘company’ that offer job and improved life quality to the residents. However, research on the evolvement of ‘company law and corporate governance’ the evolutionary process is missing. Therefore, this research paper endeavors to fill this gap into the literature through the development of clear understanding of the evolutionary processes of corporate law and the evolvement of corporate governance in Pakistan and the United Kingdom. The focus remained on the fundamental legal features of the process that deliberates on (i) the separate legal identity, (ii) the limited liability, (iii) the transferable joint stock, (iv) the delegated management, and (v) the investor ownership. Moreover, it also describes how these characteristics emerged in guilds, controlled businesses, and the major mercantilist alongwith the wealthy enterprises. Although, Pakistan remained British colony and both countries were ‘common law family’ member but the evolvement of the corporation law have been witnessed significantly different in each other. The first corporate law in India was a continual straight importation of English law during the colonial era. However, this legal transplant remained unable to address the regional circumstances as it ignored indigenous business groups. Therefore, the transferred legislation also did not give much consideration to the regulating agencies' issues.

Keywords: Evolutionary Process, Company Law, Corporate Governance, Legal Transplant, Limited Liability.