The relative position of employees in the corporate governance context: an international comparison

This article examines the situation of employees within the existing and emerging corporate governance paradigms in five countries, namely Australia, the United Kingdom, the United States, Germany and Japan. The countries chosen represent a counterpoint to the Australian position, and\ud their governance arrangements as regards employees can provide a source of innovation for the development of Australia’s provision. The United Kingdom and United States, given their historical and political ties to\ud Australia, represent examples of governance systems that have borne, and continue to bear, influence. In this respect, they have an enduring importance to the Australian corporate landscape in much the same way as aspects of the United States and United Kingdom constitutional arrangements came to be embedded in the Australian political settlement and resultant Constitution. Germany is an example of a radically different conception of the corporate structure and of the active role played by\ud employees. Japan’s system represents an amalgam of influences which are of note, particularly due to Australia’s close trading relationship and the fact\ud that Japan may point the way in terms of emerging governance trends in the Asian region. This article will briefly critique the key features of the systems of the five\ud countries and concludes that, as with other critical governance issues, the issue of employee involvement is evolving as national systems search for the elusive concept of “best practice”. This aim is made all the more critical\ud by the challenges of the “turbo-charged twenty-first century economy” where “change has become the steady state” (Stace D and Dunphy D,Beyond the Boundaries: Leading and Creating the Successful Enterprise (2nd ed, McGraw Hill, Sydney, 2001) p ix). This article will suggest in Australia’s case, that its lack of engagement with employees as part of its corporate governance arrangement is out of alignment with other systems. This gap, rather than being merely disconcerting, provides scope for the\ud improvement and enriching of Australia’s provision in this area. Given the severity of recent corporate collapses and their profound effect on employees, this issue looks to be a central one in the forthcoming decade. The article will conclude by suggesting how the Australian corporate\ud governance arrangement in the area of employee provision may be better shaped to meet the needs of contemporary commerce and society