The Gazette 1974

It will be seen that this conclusion is valid regardless

the method of appointment of the workers' represen-

tatives to the Supervisory Board chosen by the national

government in accordance with the Fifth Directive.

However, the theoretical position would be slightly

different depending on which of the two alternatives

as adopted. Und er the First Alternative the workers or

their representatives directly appoint one-third of the

Members of the supervisory board, and the shareholders

appoint the remainder (subject to the possibility of

appointing a representative of the public or the con-

sumer or some other outside interest). Und er the Second

Alternative the members of the Supervisory Board are

agreed as a "slate" after negotiations between the share-

holders and the workers or their representatives. Und er

jhe Second Alternative a member of the Supervisory

Board can only be removed from office for cause. How-

e v e r

, under the first system the body appointing the

Member whether the shareholders or the workers or

heir representatives, would have the right at any time

t o

remove from office a member of the Supervisory Board

appointed by them. It would, therefore, in theory be

°pen to the shareholders to remove or to threaten to

r e r n

° ve enough of the members of the supervisory board

appointed by them, and to appoint others, to ensure

hat a majority of the members of the Supervisory Board

^ere willing to remove the executive director whom the

. areholders wished to be rid of. In practice, however,

is most unlikely that shareholders will be willing to

ake such extreme steps in order to gain their ends,

pt in circumstances in which it was clearly desirable

hat the executive director should be removed in any

^ase. If the majority of the Supervisory Board could not

found to remove the executive in question without

such extreme measures being necessary, the situation

°uld be likely to be one in which the shareholders,

rhaps due to a misconception of their own interests,

^ r e choosing to have a confrontation with the

]Uployees. In any case it seems in general that the

Clr

cumstances in which this kind of situation would

arise are most unlikely, and that the possibility of

Shareholders getting round the principle that it is the

upervisory Board and not the General Meeting which

has pow'.. to remove executives from office in this way

is unlikely to arise.

One further comment is called for. In a small business

community such as that existing in the Republic of

Ireland (and even more so in Northern Ireland) all of

the part-time members of the supervisory board will be

likely to know all of the full-time executives on the

management board by their first names. In these circum-

stances it seems necessary that the duty of the Super-

visory Board to remove from office any executive direc-

tor who is unsuited for his position should be spelled

out very clearly in the national law implementing the

Fifth Directive. If this is not done, it seems to be in

general at least no more likely that the Supervisory

Board will remove an Executive Director who deserves

dismissal than that the shareholders would do so.

It is clear that Section 205 of the Companies Act,

1963, applies to non-feasance by directors or others as

well as to misfeasance. It follows that Section 205 would

give shareholders in an Irish company a right to peti-

tion the Court if the members of the Supervisory Board

were failing to exercise their powers to remove from

office an Executive Director who deserves dismissal. The

same situation would seem to follow from Section 201

of the Companies Act (Northern Ireland) 1960).

Clearly any measure such as a Supervisory Board

which increases supervision over executives in a "stew-

ardship" company is desirable. It may well be that the

benefits of two-tier management combined with worker

participation in management substantially outweigh the

diminution of shareholder democracy resulting from the

change in Section 182 described above. However, it

would be important if it should prove unacceptable to

the EEC Commission and the other EEC governments

that the ultimate right of the Irish shareholders to

remove executive directors from office, at least in cer-

tain circumstances (such as a deadlock on the Super-

visory Board) should be retained, that consequential

provisions clearly imposing on the members of the

Supervisory Board the duty to remove unsatisfactory

directors from office should be included in the national

legislation implementing the Fifth Directive. This duty

would bind the employees' representatives as well as

the other members of the Supervisory Board.

I.B.A. International Code of Ethics

. (1) This Code of International Ethics in no way is

l a n d e d to supersede existing national or local rules of

l ethics or those which may from time to time be

opted.

A lawyer shall not only discharge the duties imposed

pon him by his own national or local rules, but he

nall also endeavour when handling a case of an inter-

tional character to adhere to the rules of this Code

subject necessarily to the rules existing in those other

°untries in which he is active.

(2)

lawyer shall at all times maintain the honour

d dignity of his profession.

He shall, in his practice as well as in his private life,

abstain from any behaviour which may tend to dis-

credit the profession of which he is a member.

(3) A lawyer shall preserve independence in the dis-

charge of his professional duty.

A lawyer, practising on his own account or in partner-

ship where permissible, shall not engage in any other

business or occupation if by doing so he may cease to be

independent.

(4) A lawyer shall treat his professional colleagues

with the utmost courtesy and fairness.

A lawyer who undertakes to render assistance to a

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