Once a Director, Always a Fiduciary?
The corporate director is subject to duties of good faith and loyalty. As he stands in a fiduciary position vis-a-vis the company on whose board he sits, he is subject to strict obligations of self-denial. Indeed, ensuring adherence to an absolute rule in this regard is justified by the need to cont...
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| Format: | text |
| Language: | English |
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Institutional Knowledge at Singapore Management University
2003
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| Online Access: | https://ink.library.smu.edu.sg/sol_research/692 https://ink.library.smu.edu.sg/context/sol_research/article/1691/viewcontent/Once_A_Director_CambridgeLJ_2003_av.pdf |
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| Institution: | Singapore Management University |
| Language: | English |
| Summary: | The corporate director is subject to duties of good faith and loyalty. As he stands in a fiduciary position vis-a-vis the company on whose board he sits, he is subject to strict obligations of self-denial. Indeed, ensuring adherence to an absolute rule in this regard is justified by the need to control, albeit in a necessarily imperfect and arguably ineffective manner, the exercise of discretion by the director who stands in an undoubted position of power with respect to the company. A director therefore is obliged to avoid a conflict of interests and is prohibited from profiting from his office. What then of the erstwhile director? The question whether ex-directors continue to be bound, post-release, by the fiduciary obligations that prohibit conflict and profit during the course of the directorship should, technically, not be difficult to answer. |
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