A Study Of Directors’ Duty Of Diligence And The Limitation Of Their Liability

As the core mechanism of modern corporate governance,directors’ obligations have always been the focus of corporate law research,and whether directors are diligent in the process of corporate governance is the key to the interests of shareholders and the success or failure of the company.However,since the duty of diligence was first incorporated into the company law in 2005,it is only a declaratory provision,while other legal documents also have restrictions on the application of the duty of diligence of directors,thus in judicial practice,the duty of diligence has many problems such as different scales of recognition and evaluation,uninterpreted application and mixed use with the duty of loyalty,while the tort model of accountability commonly used in the current law cannot truly activate the value of the duty of diligence regime.The two key elements of "in the best interests of the company"and "with the ordinary and reasonable care of the manager" have filled the gap in the legislation on the standard of diligence,and on the basis of which a comparison of various review methods has been proposed to improve the review methods of the duty of diligence in judicial practice,which is of great significance in balancing the rights and obligations of directors.In addition,in view of the existing law and the provisions in the draft amendment,it is essential to improve and enrich the provisions on the limitation of directors’ liability for breaches of the duty of diligence in order to protect the legitimate rights and interests of diligent directors and to balance the relationship between the powers and responsibilities of good directors.