The interdependence between compliance with norms and economic behavior can be highlighted by the effects of corporate governance codes. Their underlying comply or explain mechanism is first compared with the economic theory of corporate law. Diverging empirical studies on the effect of capital market pressure on compliance with codes leave room for different compliance mechanisms, which can be compared with the discussion on corporate social responsibility and its underlying business cases. The emerging common ground between economic motivation and social interests (...) shows limits of the traditional rational actor model which can be further explored on the basis of fairness norms. Similar parallels and overlaps between market-driven self-interest and intrinsic motivation can be shown at the example of incentive effects of executive compensation. Its regulation in the German Stock Corporation Act is lacking any empirical foundation which is also true for the yet empirically unexplored compliance patterns in corporate governance. (shrink)

The EU Collective Redress Recommendation has invited Member States to introduce collective redress mechanisms by July 26, 2015. The claim of the well-known reservations concerns the potentially abusive litigation and potential settlement of not well-founded claims resulting from controversial funding of cases by means of contingency fees and from “opt-out” class action procedures. The Article posits that apart from that claim, at bottom there may be some danger that the European Commission and private interest-groups may try to pursue the enforcement (...) of their regulatory agendas in this way at the expense of individual claimants’ interests. However, in contrast to the situation in the United States, the need to complement regulatory enforcement by collective action may not appear as strong because of the relatively strict regulatory control and enforcement, which may explain EU Member States’ longstanding reluctance to adopt collective proceedings due to their concern for plaintiffs’ individual rights. Therefore, a comparative analysis is carried out to see to what extent individual rights as opposed to regulatory goals are taken into account in the different newly revised systems in place across Europe. As an interim result, the Dutch settlement procedure for mass damage claims, the English Group Litigation Order and the German test case procedure turn out to be relatively well-suited to dealing with mass damage claims. At the same time, none of them can quite reach an optimal balance between individual rights and regulatory goals and therefore each of them is subject to criticism. That is why the further question is raised as to how far these procedures could complement each other, thus contributing to the enforcement of individual rights without overregulating markets in Europe. (shrink)