Comparison with other jurisdictions Corporate law in Vietnam

1 comparison other jurisdictions

1.1 flexibility in choosing corporate governance structures
1.2 separation of supervisory , management bodies
1.3 vesting of executive powers

comparison other jurisdictions
flexibility in choosing corporate governance structures

although vietnam s corporate law adopted anglo-american legal principles, common law jurisdictions grant businesses greater flexibility in choosing corporate governance structures. loe, however, imposes mandatory internal governance structures. has been criticised failing give companies latitude adapt corporate governance structures suit needs. anglo-american law allows directors delegate powers sub-committee or person. meanwhile, in vietnam, subcommittees can established assist bom, latter cannot delegate powers former. imposition of mandatory corporate governance structures without delegation of powers leads less flexibility , efficiency.

comparisons between jurisdictions


separation of supervisory , management bodies

internal governance structures important in supervising company managers. in us, supervisory body subsumed within single-tiered board of directors, whereas in vietnam, ic independent body. through separation of supervisory , management functions, vietnamese corporate law model, @ least theoretically, ensures bom held greater degree of accountability independent checking mechanism. however, there no hierarchy vietnamese ic , bom. contrasts german two-tiered board model scs, aufsichtsrat (supervisory board) hierarchically superior vorstand (management board). because ic not recognised superior institution, has limited authority on bom. in practice, many supervisors low level employees within company. although institutionally independent, members of ic are, in reality, dependent on employers livelihoods, , therefore serve weak check against mismanagement bom or director.

vesting of executive powers

in vietnam, executive powers vested solely in director while in germany, executive powers shared equally amongst members of vorstand. encourages consensus decision-making in german companies responsibility shared amongst members of vorstand. can further contrasted japan, corporate law not designate positions corporate officers (the vietnamese equivalent of director) , executive powers largely retained within board of directors (the vietnamese equivalent of bom).