Friday, July 13, 2007

A little snippet of Dutch law

There's a bidding war going on right now. Barclays, a UK-based international bank, is bidding for ABN AMRO, a Dutch-based international bank with far-flung and pretty inefficient operations. Counterbidding is a consortium composed of Royal Bank of Scotland, a Spanish bank, and some private equity firm. Barclays is overpaying for ABN, but that's a topic for a different type of blog.

ABN seems determined to sell to Barclays, even though the RBS consortium is paying more, as reported in this article. And from that article, we see an interesting snippet of Dutch law:

Peter Paul de Vries, director of the Dutch shareholder rights organization VEB, said he was disappointed with the court's decision, which he said allowed ABN's management to hurt its own shareholders.

Under Dutch law, managers must take the interest of all "stakeholders" -- including employees, customers, creditors and society as a whole -- into account when making decisions.

In the US, corporations only legally answer to their shareholders. They can, of course, take other parties into account if their needs don't conflict with those of shareholders. But maybe it's time that corporations made the move from shareholders (one dollar, one vote) to stakeholders (one person, one vote?).

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