Concept information
Preferred term
business judgment rule
Definition
- The business judgment rule serves to shield an officer or director from civil liability when sued for a breach of a fiduciary duty, with the highest fiduciary duty owed to shareholders. Under corporation law, the business judgment rule is the classic defense used by directors and officers of corporations when they are sued, usually by shareholders. [Source: Encyclopedia of Business Ethics and Society; Business Judgment Rule]
Broader concept
Belongs to group
URI
https://concepts.sagepub.com/social-science/concept/business_judgment_rule
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