ESTABLISHING A MECHANISM TO PROTECT STAKEHOLDER RIGHTS IN CORPORATE GOVERNANCE: LESSONS FROM THE UK’S ENLIGHTENED SHAREHOLDER VALUE MODEL AND IMPLICATIONS FOR VIETNAM
This article analyzes the theoretical foundations and practical aspects of protecting the rights of non-shareholder stakeholders in corporate governance, based on the Stakeholder Value Theory and the “Enlightened Shareholder Value” (ESV) model institutionalized in the corporate law of the United Kingdom. The ESV model has expanded the scope of managerial responsibility by requiring business leaders to take into account social, environmental, community, and other stakeholder considerations, alongside the goal of maximizing shareholder value. ESV reflects a balance between traditional and modern corporate governance theories, serving as a foundation for a sustainable, ethical, and accountable governance model. In contrast, Vietnam’s current corporate legal framework continues to prioritize shareholder primacy, lacking binding provisions concerning directors’ responsibilities toward stakeholders. Through comparison with the ESV model, this article proposes several recommendations for reforming Vietnam’s corporate legal system. These include: incorporating legal obligations for corporate directors to consider stakeholder interests; establishing mandatory ESG (Environmental, Social, Governance) reporting mechanisms; strengthening the supervisory role of stakeholders; and codifying the principle of inclusive and multi-dimensional governance. These proposals not only aim to enhance transparency and ethical standards in corporate governance but also contribute to improving the competitiveness and global reputation of Vietnamese enterprises within international value chains.
Keywords: Stakeholders, ESV, Corporate Governance, Stakeholder Rights, Sustainable Development.
