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A Study On Directors' Obligation Of Loyalty

Posted on:2006-12-07Degree:MasterType:Thesis
Country:ChinaCandidate:H WangFull Text:PDF
GTID:2166360155963553Subject:Civil and Commercial Law
Abstract/Summary:PDF Full Text Request
Directors in companies play an important role in the modern company law. An important characteristic of the modern company law is the strengthening of directors' position. In law, the right that directors enjoy extends widely. In order to control directors not to damage the benefit of companies through abusing their authority, company laws in all countries are expanding the ways in which directors undertake their obligations, on the basis of emphasizing obligations in the traditional company law. In the obligations that directors should undertake, loyalty is the most important.When companies are gradually under the control of directors, the relationship between directors and companies become the basis and key to manage companies. The relationship is not a single one, but includes various legal relations in different views. Directors' obligation of loyalty results from the adjustment of Trust Law concerning the trust relationship between directors and companies. "The separation of administration and benefit" in the trust almost corresponds to "the separation of ownership and management" in the company. Directors are placed in the position of trustees and entrusted with the obligation of trustees, for the purpose of removing the slack and disloyalty of the management. Company laws in British, American, French school definite the trust relationship between directors and companies. Either from theoretical study or substantial evidence analysis, the analysis and generalization of this school are fairly scientific, which are accepted quickly by such countries asJapan and North Korea.This essay applies the methods of comparative study and classified study, makes a clear definition of directors, probes into their obligation of loyalty in terms of the trust relationship between companies and directors, discusses the theoretical basis of directors' obligation of loyalty (directors must fulfill the obligation of trustees as owners of assets and representatives of others' benefit), further argues that the concrete contents of loyalty are becoming rich, plentiful and perfect with the development of economy and variation of company operation, carries out classified study on directors' obligation of loyalty in group companies and target companies, and on outgoing directors' obligation of loyalty. Our company law makes some stipulations on directors' obligation of loyalty, but needs further improvement and development, because of being too tough, principled and ill operable. In addition, many of the contents go against the modern legislative tendency. This essay will put forward the rules to perfect directors' obligation of loyalty in our company law on the basis of theoretical study.
Keywords/Search Tags:Directors, the obligation of loyalty, the obligation of trustee
PDF Full Text Request
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