Strategic Legal & Social Issues

Table of ContentsI . Introduction 2II . Duty of Obedience 2III . Duty of forbearance 3IV . Duty of Loyalty 4V . Case of Item Software v . Fassihi 5V . Cited Works 7NameSubjectProfessorDateStrategic Legal and Social IssuesIntroductionThe lineup of Directors of a muckle are vested with the function to exercise corporate index numbers pool , conduct all(a) line of descent and control and hold all properties of the quid . 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 place however comes great certificate of indebtedness . Directors act as fiduciaries to the potentiometer , and once elected they mustiness serve the high hat interests of the confederation and the shareholders . This fiduciary con cern arises out of the board s fiduciary alliance with the mess and shareholders (Saboor H . Abduljaami p2 ) The following are the three-fold duties of a manager : transaction of obedience duty of diligence and duty of loyaltyDuty of ObedienceThe duty of obedience mandates that every handler of the corporation must do and perform nevertheless those acts designed to achieve its commission The mission and goals of the corporation are indicated in the articles of incorporation . and then , the director must constantly check whether his action is inside 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 barely it to a fault mover informing the corporation of any act through in violation of the rules of the corporation . This means that every director is ma ndated to desist from violating the interna! l rules of the corporation . As directors they are in like manner requisite to inform the corporation of any wrongdoing commit 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 respectively 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 likely care and prudence . As an officer of the corporation , the office of the director towards the corporation is not li mited to willful bright chance of trust or excess of power but extends to oversight . This means that even if there was no vile emotional state or evil motive in performing a corporate act , he provoke still be held liable if it can be naturalized that he acted derelictly . 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 hard-pressed 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 form a full essay, order it on our website: OrderEssay.net

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