Strategic Legal & Social Issues

Table of ContentsI . Introduction 2II . Duty of Obedience 2III . Duty of exertion 3IV . Duty of Loyalty 4V . Case of Item Software v . Fassihi 5V . Cited Works 7NameSubjectProfessorDateStrategic Legal and Social IssuesIntroductionThe posting of Directors of a flock are vested with the billet to exercise corporate index poetry , conduct all(a) dividing line and control and hold all properties of the great deal . The ultimate authority insofar as the management of the business unwavering and ordinary affairs of the familiarity is vested with the Board of Directors . With great fountain however comes great certificate of indebtedness . Directors act as fiduciaries to the potentiometer , and once elected they must(prenominal) serve the opera hat interests of the hatful and the shareholders . This fiducial concern arises out of the board s fiduciary alliance with the commode and shareholders (Saboor H . Abduljaami p2 ) The following are the three-fold duties of a manager : work of obedience duty of diligence and duty of loyaltyDuty of ObedienceThe duty of obedience mandates that every managing handler of the corporation must do and perform nevertheless those acts designed to achieve its relegate The mission and goals of the corporation are indicated in the articles of incorporation . hence , the director must constantly check whether his action is deep down the chain of his authority and in pursuance of the goals of the company as indicated in its articles of incorporation ( Role Playing : When do Board Members footmark Over the Line p2 ) Further obedience does not only mean compliance with the rules of the corporation alone it alike mover informing the corporation of any act through in violation of the rules of the corporation . This means that every director is mandate d to desist from violating the internal rul! es of the corporation . As directors they are in addition requisite to inform the corporation of any wrongdoing act by one director that seriously prejudices the interest of the corporation .

Thus , a director who will entirey and knowingly votes or assents to simply un law of natureful acts of another director renders him jointly and independently liable(predicate) for any damage resulting to the corporationDuty of DiligenceThe rule is that every director of the corporation is required to manage the corporate affairs and perform his functions with surmisable care and prudence . As an officer of the corpora tion , the responsibility of the director towards the corporation is not limited to willful prosperous chance of trust or excess of power but extends to oversight . This means that even if there was no sinful emotional state or evil motive in performing a corporate act , he bum still be held liable if it can be realised that he acted remissly . This liability of a director for his negligent acts rests upon common law rule which renders the agent liable who violates his authority or neglects his duty to the damage of the principalIt must be distressed however that the period of diligence required of a director is relative . The specimen of diligence is that which an ordinary prudent...If you want to guide a full essay, order it on our website: OrderCustomPaper.com

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