On The Determination Standard Of Director's Duty Of Diligence

When the "Company Law" was revised in 2005,the system of directors’ diligence obligations was first introduced,which was a major step forward in China’s company law.Regrettably,the 2005 "Company Law" only stipulates the principle of directors’ diligence obligations,does not explain the connotation of directors’ diligence obligations in detail,nor clarifies the criteria for the determination of directors’ diligence obligations.The determination standard of directors ’diligence obligations is one of the keys to the full effectiveness of the directors’ diligence system.Without this standard,the function of the directors ’diligence system is inevitably greatly reduced.At the same time,because the legislation does not clarify the connotation and identification standards of directors ’diligence obligations,judges can only rely on their own legal literacy to judge whether directors violate the diligence obligations in judicial decisions,and the professional qualities of different judges are different.Different judgments in the same case undermine judicial authority and justice.In view of this,it is really necessary to clarify the standards for the determination of directors’ diligence obligations in the company law.This dissertation first discusses the meaning and theoretical basis of the director’s diligence obligation,pointing out that the director’s diligence obligation refers to the directors must have a reasonable and prudent person in the management of company affairs should be prudent,diligent and skill in similar situations.Secondly,through sorting out the legislative provisions of diligence obligations,it is pointed out that the legislation of diligence obligations does not clarify the connotation and identification standards of directors ’diligence obligations,does not examine the degree of directors’ subjective faults,and responsibility is guided by the results of decisions.Thirdly,a comparative analysis of the determination standards of directors’ diligence obligations in the UK,the US,Germany and Japan.Finally,based on the above analysis,suggestions were made to establish the standards for the determination of the directors’ diligence obligations in China.Specifically,one is to clarify the recognition standard of directors ’diligence obligations in the company law,and establish the combination of subjective and objective standards as the standard for directors’ violation of diligence obligations,and point out that the combination of subjective and objective standards consists of behavior,subjective fault,objective loss,and association It is composed of four elements and is susceptible to factors such as the size and nature of the company where the director is located,the level of professional knowledge of the director himself,the status of the director in the company,and supplementary provisions in the articles of association.