Study On Fiduciary Duty Of Directors In Corporate Social Enterprises

Relying on the innovative model of solving social problems and promoting social welfare by commercial means,social enterprises have become an objective existence with future expectations in China.At the same time,the dual mission requirements of social enterprises make corporate governance special,in which the fiduciary duty of directors of corporate social enterprises should be an important content of the corresponding legal research.However,since there is no superior legislation related to social enterprises in China,the existing research and regulation mainly come from academic circles and some local policies,and the current provisions on the fiduciary obligations of corporate directors are not perfect.This paper mainly analyzes the relevant theories and practices of corporate social enterprises and their fiduciary obligations of directors in Britain and the United States,combines the domestic situation,and put forward suggestions to improve the fiduciary duty system of directors of corporate social enterprises,which is suitable for Chinese national conditions.This paper is divided into four parts.The brief contents are as follows:The first part defines the fundamental characteristics of social enterprises and the existing legal practice and problems.In order to alleviate the respective difficulties of traditional companies and non-profit organizations,the dual coexistence of profit mission and social mission is the fundamental feature of social enterprises.At the same time,the legal regulations such as asset disposal and internal and external governance of social enterprises are affected by the dual mission.The legislative practice of social enterprises abroad has formed two major regulatory models,the American Model and the Britain Model.The former is dominated by benefit companies with sufficient autonomy space;The latter is dominated by community interest companies with strong regulation.The legal practice of social enterprises in China is still in the preliminary stage.The forms of social enterprise legal persons are diverse,involving single type and mixed type;and the certification work adopts the parallel mode of official certification and private certification,which needs to be developed in a coordinated manner.In addition,the existing legislative system lacks attention to the fiduciary duty of social enterprise managers,and the absence of corresponding fiduciary duty rules makes it difficult to respond to the particularity of social enterprise governance.The second part discusses the content and standard of fiduciary duty of directors of corporate social enterprises from the perspective of international comparison.Corporate purpose is an important source of directors’ fiduciary duty in social enterprises,which can affect the content and standard of the duty.On the one hand,choosing general public welfare purpose or specific public welfare purpose determines the object and content of directors’ fiduciary duty.On the other hand,choosing whether profit goal or social goal gives priority shapes the standard of directors’ fiduciary duty.Specifically,the application of duty of care and duty of loyalty must be coordinated with the dual mission of social enterprises.On the one hand,the different imputation standards between public welfare decision-making and business decision-making affect the identification of objective standards of duty of care,and the multiple attributes of decision-making also lead to the non universal application of business judgment rules.On the other hand,prohibiting favoritism,the basic meaning of the duty of loyalty,cannot be directly applied to the conflict between non private interests,and its basic type is not enough to regulate directors’ behavior in public welfare undertakings.The third part studies the limitation of directors’ liability for breach of fiduciary duty in corporate social enterprises.The restriction of directors’ liability through the articles of association is not only the freedom allowed by law,but also the necessity of business practice.In the face of social enterprises,the specific reasons should be adjusted according to the type of decision-making and the type of directors.The exemption system of dissenting directors’ resolution responsibility is the universal embodiment of personal responsibility,which should be referred to by social enterprises.Although the legal compensation ceiling mechanism is highly operational and simple and direct,it is easy to further amplify the lag of the law,and the feasibility is not clear.The compulsory compensation fee system can provide financial support and confidence for directors to protect their rights,so it is necessary.The fourth part explores the Chinese path of the implementation of the fiduciary duty of directors of corporate social enterprises.First of all,we need to clarify the purpose and nature of social enterprises,and better coordinate the rules of fiduciary duty of directors on the basis.It includes that social enterprises shall be included in the regulation of special legal persons to realize the compatibility of profit-making and nonprofit;and that it is allowed to set specific public welfare purposes,exclude general public welfare purposes,and manage them in the form of "negative list";and that we shall expand the objects of fiduciary obligations of traditional commercial companies and clearly introduce stakeholders.When perfecting the rules of duty of care,we should apply the minimum objective standards to the directors according to the decisionmaking attributes,and allow the application or transformation of the business judgment rules when pursuing responsibility.When perfecting the rules of the duty of loyalty,we should abandon the idea of "one case,one discussion",adopt the overall decisionmaking effect,fine tune the existing specific types of violations of the duty of loyalty,and expand the new types with reference to the regulation types of non-profit legal persons.Finally,the limitation mechanism of liability for breach of fiduciary duty,such as the system of limitation of directors’ liability in the articles of association,the system of compulsory compensation fee system and the system of exemption from the liability of dissenting directors’ resolutions,should be established and improved.