Why Are Corporate Executives Subject to Fiduciary Duties? [No. 86]

What are fiduciary duties and why are they different from the basic rules of everyday business transactions? Professor Robert Miller discusses how “fiduciary duties” describe a particular relationship between directors and shareholders. Directors are held to a higher standard of behavior above and beyond the usual rules of the marketplace because they act on behalf of the shareholders. #law #no86 #lawschool #lawstudent #corporatelaw

Robert T. Miller is the F. Arnold Daum Chair in Corporate Finance and Law and the Associate Dean for Faculty Development at the University of Iowa College of Law.

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As always, the Federalist Society takes no position on particular legal or public policy issues; all expressions of opinion are those of the speaker.

[bsimmz]

In a market place you must be honest and live up to your contractual obligations. That, is the morality of a market place.

FIDUCIARY DUTY:
When you become someone's fiduciary however, you owe them much more than the morality of the market place . You owe them a duty of unremitting honesty to the company & shareholders. You are required to act for their benefit not your own. Thus;

1. No Fraud;

2. No Lies;

3. Act in Good Faith;

4. Fiduciary responsibility;

5. Full disclosure (All material information in a director's position has to be disclosed).

The Legal Duty of Good Faith is much more than the morality in the market place.

[mikepettipas]

Trust Law, Expressed, Resulting, Constructive

[kylegamer]

Greedy people have now made it illegal to be greedy in any way that doesn't benefit them. I love capitalism.