Litigation by Shareholders and Directors: An Empirical Study of the Statutory Derivative Action

A statutory derivative action has been proposed for the United Kingdom and is contained in Part 11 of the Company Law Reform Bill. Australia has had a statutory derivative action for approximately 6 years. This paper outlines the results of the first empirical study of the Australian statutory derivative action. The study provides insights into the way Australian courts have interpreted and applied this legal remedy. Issues discussed in the paper include the role of shareholder litigation in corporate governance and the purposes of the statutory derivative action.