TAILIEUCHUNG - Lecture Dynamic business law - Chapter 39: Corporations, directors, officers, and shareholders
After studying this chapter you will be able to understand: Why is it important to regulate the interactions among directors, officers, and shareholders within a corporation? What is the role of a director, an officer, and a shareholder? What are the duties of directors, officers, and shareholders? In what ways can a director, officer, and shareholder be held liable? What are the rights of directors, officers, and shareholders? | Chapter 39 Corporations: Directors, Officers, and Shareholders Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. Chapter 39: Corporations, Directors, Officers, and Shareholders 39- Summary of Roles of Directors, Officers, and Shareholders Directors-- Officers-- Shareholders-- Vote on important corporate decisions Appoint and supervise officers Declare and pay corporate dividends Manage corporation Run “day-to-day” business of firm Agents of corporation Elect board of directors Approve major board decisions Directors vote on important corporate decisions, appoint and supervise officers, declare and pay corporate dividends, and manage the corporation. Officers run the “day-to-day” business of the firm, and are agents of the corporation. Shareholders elect the board of directors, and approve major board decisions. 39- Fiduciary Duties Definition: Duties to corporation that individuals within corporation have Primary fiduciary duties include: Duty of Care Duty of Loyalty Duty to Disclose Conflict of Interest Fiduciary duties represent responsibilities to the corporation that individuals within the corporation have. Primary fiduciary responsibilities include the duty of care, the duty of loyalty, and the duty to disclose actual or potential conflicts of interest. 39- Exhibit 39-2: Liability of Directors and Officers Can be held personally liability for their own torts and crimes Can be held personally liable for torts and crimes of other employees they supervise Can be held liable for wrongful transactions involving company stock Cannot be held liable for decisions that harm company if they were acting in good faith at time of decision Corporate directors and officers can be held personally liability for their own torts and crimes, and they can be held personally liable for the torts and crimes of other employees they supervise. Further, .
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