A Study On The Obligation Of The Director In The Company Act

Director, as an important role in modern company governance structure, refers to the permanent body which manages and executes the affairs in a company. Director plays an important role in a company due to its legal state, and it is the board of director that acts to produce the function of modern company.In this thesis, it first elaborates on the general concepts of the obligation of director and the basis of legal theory why director is subject to the obligation to the company through comparing, analyzing and referring to the existing researches. British and American methods start from the essence of the trust or the ageny relation between director and the company, thinking that director should hold the obligation of trust or faith to the investor while the continental legal system thinks that the legal relation between director and the company is a relation of appointment in which director is obliged to manage the company safely. Compared with the trust and the ageny statements, the writer thinks that the appointment statement is more reasonable and closer to the reality. Thus, the obligation of director to the company can be divided into two types--assignment obligation and obligation that leave one's post.Then in the main part, it deals with the assignment obligation including care obligation and faithful obligation held by director to the company, such as the self-trade biding, the competitive-forbidden, and the rules of the company's opportunity as well as obligations that leave one's post. Meanwhile, it also enriches and develops the content of faithful obligation through definitely indicating the responsibility when director disobey the above obligations and perfecting the corresponding remedial methods. obligation of caution and obligation of faith. From the corresponding rights of the director duties, modern company law pays more attention to directors duties to the shareholders and debtors'rights protecting and have strengthened the responsibilities of directors while emphasizing the director' s obligation to company. Besides, in defining the obligation of care which should be held by director to the company, it points out that director should not only be cautious, industrious in managing and carrying out the affairs, showing his corresponding skills and level, but also face up to the reasonable risk in the judgment of commercial management, introducing some rules for managing and judging to exempt director from the responsibilities led by reasonable faults.In china, the current company act is imperfect in the aspect of defining the obligation of director, which has become the source that causes many directors lack of enthusiasm in working and indifferent to the company's interests. In addition, this imperfection hardly can supply valid legislative authority in prosecuting the responsibility of the suspect directors. As a result, in analyzing the above content, this thesis also proposes legislative suggestions against the fact that the obligation of director in the current company act is too simple.