Abstract

This article examines some pertinent interpretational issues concerning the statutory framework relating to requisitioned shareholder meetings in terms of s 61(3) of the Companies Act 71 of 2008. The purpose is to assess the efficacy of this statutory framework, including its interpretation by the courts, in promoting shareholder governance while balancing the rights and obligations of company shareholders and directors. The article also assesses whether s 61(3) and its related provisions on requisitioned shareholder meetings are aligned with the trends in other modern corporate-law jurisdictions, particularly the United Kingdom, Australia and Canada. The article finds that while s 61(3) provides for an uncomplicated procedure that seeks to facilitate, rather than deter, requisitioned shareholder meetings, a fundamental weakness of the Companies Act in this regard is that it does not directly regulate the time frames within which a requisitioned shareholder meeting must be convened. Furthermore, the Act does not grant requisitionists the right to call and hold a requisitioned shareholder meeting if the directors have failed to do so. Moreover, the Act tends to be lenient on directors who ignore, unduly refuse or delay the calling of a requisitioned shareholder meeting. The article makes recommendations for legislative reform in South Africa to strengthen shareholders’ rights and directors’ accountability in the context of requisitioned shareholder meetings. It also provides recommendations on how the courts should interpret certain provisions of the Companies Act to advance the underlying objectives of requisitioned shareholder meetings, thereby enhancing corporate governance standards in South Africa.