Fostering Corporate Sustainability Through Directors' Duties: South Africa's Attempt to Align Corporate Governance with Its Constitution

Ruth Jebe, Boise State University
Matthew Meacham, University of Idaho
Max Williams, University of Idaho


The 1990s saw a dramatic increase in interest in two streams of activity related to business conduct--corporate governance and corporate sustainability. While commanding significant attention, these two fields produced modest change in corporate behavior, at best. Part of this phenomenon is because the two streams are separate, with disconnected legal and governance structures. Missing from the discussion is the potential to leverage corporate governance to foster corporate sustainability, to infuse social and environmental factors into corporate law through corporate law itself. This article contributes to the literature on corporate governance and corporate sustainability by examining South Africa's experiment in aligning corporate law with constitutional principles. South Africa has built legal infrastructure in the form of its Constitution and Companies Act that could leverage corporate governance, specifically the duties of directors, as a force to serve societal interests. However, the state of South Africa's statutory and common law holds uncertainties that could derail the country's attempt to align corporate law with constitutional law. We assess the current state of South Africa's constitutional and company law and identify potential interpretive streams open to the South African judiciary as it builds the nation's common law. We conclude that, while South Africa has created much of the necessary legal infrastructure for alignment, it faces major challenges to interpreting company law in a manner that fulfills the promise of aligning it with the Constitution.