A director’s duty to exercise their powers and to discharge their duties in good faith and in the best interests of the corporation usually means: Select one: a. Acting in the best interest of employees. b. Acting in the best interests of the company’s shareholders. c. None of the other options for this question are correct. d. Acting in the best interest of creditors.
Question
A director’s duty to exercise their powers and to discharge their duties in good faith and in the best interests of the corporation usually means:
Select one:
a. Acting in the best interest of employees.
b. Acting in the best interests of the company’s shareholders.
c. None of the other options for this question are correct.
d. Acting in the best interest of creditors.
Solution
The correct answer is:
b. Acting in the best interests of the company’s shareholders.
A director's primary duty is to the corporation, which generally means acting in the best interests of the shareholders who are the owners of the corporation. This includes making decisions that increase shareholder value and protect their investments. While the interests of employees and creditors are important, they are secondary to the interests of the shareholders.
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