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Directors ' Duties in the third person

Author: LuoYuan
Tutor: HanZuo
School: Central University for Nationalities
Course: Economic Law
Keywords: the third person the purpose of the company the interest of the company the maximization of the interest of investors
CLC: D922.291.91
Type: Master's thesis
Year: 2011
Downloads: 15
Quote: 0
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Abstract


As the separation between ownership and management have deepened, directors have become the most important decision maker, in order to better meet the obligations of rapid economic change, how to improve the system of duty of director has become an important research subject in Company Law.As the legal personality of company continues to be recognized, and the theory about the directors’legal status has been researched, the directors’duty towards the company bears no doubt. But as the company became more and more important in the economy, the directors’decision affects not only the company, but also the third person outside the director and company. As a result, in order to protect the legitimate interests of third persons against acts of infringement of directors, to establish and improve the duty of directors towards the third person becomes the most important way.Firstly, this paper has made the definitions of the director and the third person. Firstly, the explanation of the director in the regulations and theory has been introduced. Secondly, this paper has classified the directors and analyzed the some difficult issues. Finally, the paper has discussed the meaning and scope of the third person.Secondly, about how to design the system of the duty of director towards the third person, there mainly have been two kinds of opinions. The traditional company law holds the point that the directors only bear the duty towards the shareholders. Since in the 20th century the theory of social responsibility theory developed and the large-scale acquisition wave brought serious social problems, the new point have been brought that the directors bear duty towards the shareholders and the other third persons.Then, based on the analysis of the points mentioned above, this paper proposed some suggestions to rebuild the directors’duty towards the third person from the three aspects, and made the conclusion of this paper:the company’s interests equal the interests of investors (the sum of the interests of shareholders and creditors), and the directors bears the duty towards the shareholders and creators.Finally, in the fourth chapter, having analyzed the related regulations of PRC, this paper pointed out:the existing regulations on duty of the directors towards the third person haven’t given sufficient protection to the third person of the company. Thus, this paper gave some recommendations on the obligations of directors to the third person from the subject, standard and object.

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