A corporate director or officer may be able to avoid liability to the corporation or to its shareholders for poor business judgments by meeting the requirements of the

Question

Quizplus · Accepted Answer

The Business judgment rule provides protection to corporate directors and officers from being held personally liable for decisions made in good faith and with reasonable care. This rule assumes that the directors and officers were acting in the best interest of the corporation and did not have any personal gain or interest in the outcome of the decision. Therefore, if the requirements of the Business judgment rule are met, the director or officer can avoid liability for poor business judgments. The Sarbanes-Oxley Act and Dodd-Frank Financial Reform Act are regulatory acts that address different aspects of corporate governance and reporting but do not provide protection from personal liability. The ethical reasoning rule is not a legal standard but rather a guideline for ethical decision-making.

A Corporate Director or Officer May Be Able to Avoid