Under a voluntary agreement under corporate law, directors are not personally liable for the company`s debts unless they have provided a personal guarantee. Even if a director has provided a guarantee, a CVA means that a director is only responsible if the company is unable to pay and continues to have a source of income. The correction of externalities, as discussed so far in this chapter, has focused on government intervention in private markets through regulatory approaches such as taxation, authorities and standards. However, if the government works with objectives other than maximizing social welfare [Peltzman (1976)], there is no guarantee that state intervention will achieve social optimum. In addition, lipsey and Lancaster`s two best arguments (1956-1957) and the “double dividend” literature suggest that state intervention could reduce social welfare, even if the government`s objective is to improve well-being. It is therefore useful to consider other possible ways to achieve environmental protection. Two possibilities are voluntary environmental impact programs and the use of courts. At least in the mid-19th century, courts in Europe and elsewhere understood that insurance contracts deviated considerably from what was traditionally considered to be an ideal type of contract (a voluntary agreement with negotiated terms between two parties with the same bargaining power). In many cases, the role of insurance agency as a custodian can hardly be exempted from the voluntary nature of insurance. Insurance companies use typical standard contracts almost everywhere with conditions that are not applicable. And in all cases, but in very few cases, the parties do not have the same bargaining power. As a general rule, the insurance company is a much larger economic entity; Competing insurance companies rarely offer very different terms (except sometimes price) and the insurance company has information about the size and value of the contract that the insurance claimant does not have.
Moreover, the promising nature of insurance gives the insurance company enormous power as soon as the insured is entitled; on that date, the insured cannot take out a new insurance policy. Since the 1990s, the EU has developed a new regulatory policy that increasingly focuses on the use of alternative instruments that complement traditional legislation. These alternative instruments, less restrictive or non-governmental, are often characterized by the terms “soft law,” “self-regulation” and/or “co-regulation.” “Voluntary agreements” are the typical result of these alternative forms of governance. The main objective of the diversification of regulatory instruments was to improve the efficiency, legitimacy and transparency of EU action and to respect the principles of delegated powers, subsidiarity and proportionality in the EU legislative process. In the CONTEXT of the EU, the term `voluntary agreement` generally refers to an agreement which is not the result of a political decision-making process exclusively within the framework of the official EU institutions (European Commission, Council of the European Union, European Parliament – i.e. the so-called Community method), but mainly the result of negotiations between organisations of legitimate social partners to reach such agreements through EU legislation.