LGLS 1901 Lecture Notes - Lecture 17: Fiduciary, Derivative Suit, Liability Insurance
6 Mar 2017
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Rights of directors, participation in corporate decisions and inspect corporate books and records, compensation (usually a nominal sum, indemnification. Allowed faulty products to be released (think vw lawsuit against directors who allowed the scandal to happen); the corporation pays for the individual director"s damages. Corporate officers and executive: officers serve at the pleasure of the board but have fiduciary duties to company as well, employment relationships are generally governed by contract law and employment law. Duties and liabilities: directors and officers are fiduciaries and owe the company ethical and legal duties. Duty of care: duty to make informed decisions. Fully informed on corporate matters: duty to exercise reasonable supervision. Duty of loyalty: subordination of personal interests to the welfare of the corporation, no competition with corporation, no conflict of interests, no insider trading, no transaction that is detrimental to minority shareholders.
