deregulation – The Fearless Scholar

Corporate deregulation – time for investors to play their voting cards?

Brenda Hannigan, 1 June 2026 7 mins read

In an ill-advised move, the board of BP recently rejected a shareholder resolution so preventing its circulation to shareholders ahead of the company’s annual general meeting (AGM). As the FT reported (11 March 2026), the resolution addressed strategies to maintain shareholder value in the not unlikely event of a decline in demand for fossil fuels. It was filed by a group of 16 institutional investors and some retail investors brought together by a Dutch green investor group, Follow This.

The board’s rejection of the resolution made the news because we are accustomed to corporate boards maintaining at least a semblance of co-existence alongside shareholder engagement, empowerment and stewardship. Not in this case. In all probability, the resolution would have gone almost unnoticed by the media, had it not been rejected by the board.

The episode seemed to reflect in many ways the current position. There is a business clamour for capital, flexible markets and a wider pool of investors. The Government has responded with deregulation initiatives aimed at driving ‘growth’ and ‘competitiveness’. The consequence, whether or not intended, is an increase in board autonomy and a consequential diminishing of the role of shareholders. The cumulative effect of recent changes should be a wakeup call for shareholders who need to find their voice and show a greater willingness to challenge boards.

Regulatory retreat by the Financial Conduct Authority

The deregulation agenda is driven, in part, by the collapse in London listings over the past decades (for many reasons including the growth of private capital and the perceived regulatory burden of being listed). In March 2009, there were 1130 UK listed companies, by March 2026, there are 764. It is a similar picture on AIM, the Alternative Investment Market. Hence there have been numerous reviews of listing and capital raising (Hill (2021), Kalifa (2021), Austin (2022)) , followed by a new UK listing regime (UKLR) . It was devised by the Financial Conduct Authority (FCA) with the intention of attracting listings and investors to a deregulated market and came into effect in July 2024.

A significant element of the new listings regime is the removal – despite robust investor objections – of shareholder approval of substantial transactions and related-party transactions (i.e. with directors, substantial shareholders and associated companies so potentially rife with conflicts of interest). The requirement for approval was long regarded as a defining component of the gold standard, London premium, listing. Following consultations, the FCA was persuaded by strong support for abolition (unsurprisingly) from the companies themselves, their legal advisers and UK market operators [paras 6.16, 6.19, 6.29].

The FCA noted that companies would not proceed in any event with such transactions without the support of their largest shareholders – in effect, acknowledging that only shareholders in the inner circle matter [para 6.50 to 6.57]. It considered that shareholders have other tools such as statutory shareholder meetings (invariably post hoc) and the ability to requisition meetings (only if they hold more than 5%, and unlikely in practice). Of course, the FCA also noted, shareholders can remove directors, but this nuclear option is rarely publicly exercised, or they can disinvest. The latter option seems a strange suggestion given part of the policy background here is precisely to stop disinvestment and attract investors to London listings.

Legislative retreat by the Department for Business and Trade

If the FCA is the inner ring of this deregulation, the outer ring is the Department for Business and Trade (DBT) which has taken an increasingly deregulatory stance.

In January 2026, the DBT, under a Labour Government, abandoned the long-promised and much-anticipated Audit Reform and Corporate Governance Bill — legislation that had its origins in the Brydon Review (2019) and which was intended to increase oversight and accountability, not just of corporate auditors, but also of directors. Investors would have benefitted potentially from these reforms, given they struggle with oversight of the directors. The ‘difficult decision’ (in the words of the DBT Minister), after six years of work, was hidden in a lengthy DBT press release.

In this regard, the DBT was following in the footsteps of the previous Conservative Government which, in October 2023, reneged on a commitment, again reflecting Brydon, to introduce requirements for a variety of board statements on matters such as distributable profits, distributions, risk management and resilience, including the risk of material fraud. Such statements would have forced boards to verify and stand by this information. In this case, the withdrawal came even though the draft regulations were already before Parliament.

These U-turns would suggest effective lobbying from big business and their lawyers, under cover of the many economic and political crises of current times, to reduce transparency and block any measures which might expose directors to any individual accountability. The result, if not the declared aim, of these changes is to reinforce the power of corporate boards and weaken shareholder democracy.

The withdrawal of the ‘public register’ of shareholder dissent

A further example of successful lobbying is the DBT’s announcement, in November 2025, that the Government had asked the Investment Association to cease to maintain the public register. This public register was set up in 2017 and recorded significant shareholder dissent, categorised for this purpose, in accordance with the UK Corporate Governance Code (2024), Provision 4, as votes against the board recommendation on a resolution of 20% or more.

The request is inexplicable: why ask the Investment Association to discontinue a mechanism which usefully collected the relevant information in one place? The information is publicly available in any event but would require a searcher to have the patience to trawl through the National Storage Mechanism, company by company. There is no cost to the companies or to the Government. The only explanation is that the DBT bowed to business pressure: boards disliked being featured on a register which alerted investors and other interested stakeholders to shareholder discontent, especially if the company appeared (as some did) year after year.

Ironically, BP is one of the beneficiaries of this deregulatory change. Proving that shareholders can resist board demands, BP shareholders did vote down two resolutions supported by the board including refusing to accept a new set of articles (52.88% against) which, inter alia, would have allowed the directors to hold only virtual (electronic) AGMs. They also voted heavily (74.15%) for a shareholder resolution calling for disclosures on exploration capital expenditure and the creation of shareholder value which had been opposed by the board. Had the public register of dissent still been in use, BP would have been an entry on it.

More deregulation to come – what shareholders must do

There are other deregulation initiatives in the pipeline. DBT plans to allow virtual AGMs (vigorously opposed by institutional shareholders as a lesser form of public accountability, giving boards greater control of shareholder engagement than a physical meeting) and intends to streamline (i.e. reduce) corporate reporting, primarily for the largest companies. Of course, a switch to virtual meetings will need shareholder approval since commonly it will require an alteration of the company’s articles of association. Shareholders will want to think about whether they are willing to support such a change and the implications for their engagements with the company.

The DBT also intends to deregulate (reduce) disclosure by the largest companies so investors need to reflect on what information they are willing to do without and be prepared to stand their ground on reduced disclosures if they are unhappy. Let the largest institutional shareholders vocally oppose related-party transactions, even if they no longer have a vote on the matter.

Contrary to initial expectations, it may be that the result of the deregulatory measures favouring boards is to force a level of engagement and voting from shareholders which has not previously been the case. Shareholders need to realise that they do have a weapon – their votes – and they should make considered use of them.

Trump’s EU foreign policy, implicated scholarship and the ‘Brussels Effect’

Uta Kohl, 16 January 2026 —- 8 mins read

For Europe, the fierceness of the Trump administration’s hostility to the EU has come as a shock. It is unprecedented in scale and kind, and manifests itself in words (Vance’s speech in Munich attacking the EU over free speech and migration or Trump describing Europe as ‘decaying’ and its leaders as ‘weak’) and actions ( halting military aid to Ukraine, announcing 30% tariffs on the EU, or threatening to take Greenland by force). Yet, these hostilities do not come out of nowhere and build on a rise of transatlantic tensions over many US policy choices between 2000 -2024 and acceleration of those tensions over the last decade. Legal and international relations scholars have decried these developments as a breach of trust or, in some cases, a of international law. However, there appears to be little soul-searching about how we, as scholars, may be implicated in them. Whilst academia generally remains on the outskirts of day-to-day politics, we produce knowledge and narratives that create and shape discourses that have an impact on politics.

The Brussels Effect

One such popular academic narrative that has fed into the transatlantic hostilities is the ‘Brussels Effect’. The Brussels Effect was first coined by the Finnish-American scholar, Anu Bradford, in her article (2012) and book (2020) in which she purports to describe ‘how the European Union rules the world’. Her thesis is simple, namely that the EU can set – and has set – global regulatory standards by virtue of being a large and attractive market for many importers from outside the EU and, then, by setting (strict) standards for these importers who often have an incentive to adopt them as their global baseline. This de facto global harmonisation by corporate fiat is complemented by de jure global harmonisation as the home states of these corporations decide to follow the EU regulatory lead and enact like laws in their jurisdictions. Thus there is a global convergence towards EU standards without the political difficulties and cost associated with harmonisation efforts following formal processes. Effectively, the EU gets harmonisation on the cheap. European data protection law is widely seen as an example par excellence of the Brussels Effect as it has led to a widespread adoption of data protection laws around the globe.

Bradford’s Brussels Effect has been hugely successful as a seemingly objective and neutral synthesis of facts describing EU regulatory hyperactivity with extraterritorial effect. For the digital world, this seems particularly true considering the recent raft of EU legal instruments dealing with online platforms, such as Digital Services Act, the Digital Markets Act and the AI Act. There are many more (including corporate sustainability measures), and all of them have exterritorial reach as they apply to foreign providers that operate in the EU. The Brussels Effect has been referenced by thousands of scholars and taken up by EU policy makers and politicians with gusto, often as a badge of pride and honour.

And yet, there is more to the Brussels Effect than meets the eye. For a start, it is not simply a description of facts about EU regulation but a meta-narrative that puts a particular perspective or spin on facts. Meta-narratives are stories about stories, which explain, tie together, and legitimise or delegitimise smaller facts and events, and appeal as much to the emotions as they do to the intellect. Bradford’s article starts off by appealing to the sensitivities of the average American: ‘EU regulations have a tangible impact on the everyday lives of citizens around the world. Few Americans are aware that EU regulations determine the makeup they apply in the morning, the cereal they eat for breakfast, the software they use on their computer, and the privacy settings they adjust on their Facebook page. And that’s just before 8:30 AM.’(3)

The particular perspective of the Brussels Effect narrative is one of EU regulatory overreach. This charge is already implicit in the title of Bradford’s book: How the European Union Rules the World. Implicit in her argument is the question: Why should Europe rule the world? Centuries of European imperialism, including legal imperialism, are bygone and, if not, should be. Brussels should be ashamed of itself. By the same token, if the Brussels Effect narrative offers a legitimate critique of excessive EU law, then the Trump administration’s opposition to EU regulation of US platforms also strikes a legitimate chord. In that case, the large platforms may also be right in characterising the fines by the Commission under EU platforms regulations as ‘protectionist’, ‘discriminatory’ or ‘disguised tariffs’ or as ‘censorship’. Yet, does the EU really rule the world? Unlikely.

There are indeed good reasons why the Brussels Effect narrative is not plausible. Here are three. First, EU (digital) regulation seeks to regulate the European single market and must necessarily apply to foreign providers who do business in Europe. This is a standard jurisdictional approach adopted across the globe as it rightly protects local standards from being undermined by foreign providers. Second, when foreign corporations, like the US digital platforms, adopt European standards as their global baseline, this is a commercial decision driven by market forces. The EU cannot ‘choose’ this as a route to global harmonisation, but as a form of bottom-up harmonisation it can lend support and legitimacy to political harmonisation. Such market forces come and go, wholly outside the EU’s power. Third, whilst according to Bradford’s Brussels Effect the EU imposes its preference for ‘strict rules’ on ‘the rest of world’ (citing almost exclusively US examples), arguably the US and not the EU is the outlier in its preference for laissez-faire law, especially in respect of the tech platforms. Already in 2005, Frederick Schauer observed that the absolutist speech protection of the First Amendment was the odd one out internationally: ‘On a large number of other issues in which the preferences of individuals may be in tension with the needs of the collective, the United States, increasingly alone.’ Thus, it is far more plausible that EU regulations are simply more aligned with the public policies and interests of other jurisdictions than US laissez-faire law is.

The Washington Effect

If the Brussels Effect narrative paints a skewed picture of EU regulatory activism, it may be more compelling to understand EU regulations through the counter-narrative of the ‘Washington Effect’. A counter-narrative uses the same facts but tells a different story. In this case the story is that EU platform regulation is not an offensive extraterritorial strategy for Europe to attain global ‘superpower’ status, but rather a defensive territorial one that seeks to counter, in Europe, the hegemony of US platforms and US laissez-faire law. In other words, the EU is in pursuit of reclaiming digital sovereignty and perhaps even leads the global resistance to US legal imperialism.

The counter-narrative of the Washington Effect builds on the idea that deregulation is not nothing or neutral, but a form of regulation whereby existing legal standards are abandoned or watered down. It may occur within a jurisdiction through explicit deregulatory measures or across jurisdictions when the more permissive laws of one State undermine the more restrictive laws of another. Although deregulation appears to facilitate the ‘free’ market – free from state interference – even a free market is enabled by the general law of the land, such as contract and property law, corporation law, basic rules on fair competition, product liability or negligence law. Thus deregulation that meddles with these fundamental enabling market rules constitutes a significant regulatory intervention with the market, rather than a non-intervention. Such deregulatory interventions reconstitute the market and its distribution of rights, privileges, powers and authorities. In other words, deregulation also regulates.

There is plenty of evidence of the de facto or de jure imposition of US deregulation on ‘the rest of the world’. Most notably, section 230 Communications Decency Act (1996) which immunises platforms from liability (under the ordinary law of the land) for wrongful publications by third parties on their domains, is one such piece of deregulation that the US has successfully exported to more than 60 jurisdictions worldwide with an enormous effect on global networked space. Equally, a de facto Washington Effect occurred when US digital platforms – ‘socialised’ through US permissive laws, most notably US First Amendment jurisprudence – started to offer their services in Europe and elsewhere with minimal legal restraints built into their content distribution and ad revenue systems and when this starting position went unchallenged in Europe for decades. So perhaps it is the Washington Effect, not the Brussel Effect, that really shows who rules the world.

The moral of the story

Academic scholarship matters. It tells stories. The Brussels Effect is a story that has mattered. Its effects have been significant. It has lent credence to the Trump administration’s opposition to EU tech regulation. It has then put the EU on a regulatory backfoot and, at the same time, disguised quite how successfully Washington has exported its deregulatory regulation to the rest of the world. The Brussels Effect demonstrates that just because a narrative has intuitive appeal and in fact appeals to many, does not mean it’s a good story. This is a dangerous one.

For a more in-depth analysis of the topic, see Uta Kohl, ‘The Politics of the ‘Brussels Effect’ Narrative’, forthcoming in ACROSS THE GREAT DIVIDE: PLATFORM REGULATION IN THE UNITED STATES AND EUROPE (A. Koltay, R. Krotoszynski, B. Török, E. Laidlaw (eds), OUP, 2026)