Skip to main content
Unpublished Paper
Report to Russian Center for Capital Market Development: Comparative Analysis on Legal Regulation of the Liability of Members of the Board of Directors and Executive Organs of Companies
U of Texas Law, Law and Econ Research Paper No. 110 (2007)
  • Bernard S. Black
  • Brian R Cheffins, University of Cambridge
  • Martin Gelter, Vienna University of Economics and Business Administration
  • Hwa-Jin Kim
  • Richard Nolan, University of Cambridge
  • Mathias M. Siems, University of Edinburgh
  • Linia Prava
Abstract

This Report was prepared, with support by the World Bank, for the Russian Center for Capital Market Development and the Russian Federal Service on the Securities Market (FSFM). We discuss the liability under company law of members of the board of directors, senior managers, and controlling shareholders of public companies in Canada, France, Germany, Korea, the United Kingdom, and the United States (plus a more limited look at Austria, the European Union, Italy, Japan, and Latvia), and apply this comparative analysis to the Russian context. We recommend amendments to the Russian Law on Joint Stock Companies and related legislation. We propose measures to enhance the effectiveness of derivative suits; define the concepts of good faith and conflict of interest; establish duties of disclosure and confidentiality, extend duties under company law to controlling shareholders and de facto directors for conflict of interest transactions; protect directors against liability for business decisions adopted without a conflict of interest. We do not recommend the creation of significant administrative or criminal liability, nor expanded duties of directors for a company in financial distress. This document includes a separate Overview of the Report by Professor Black which provides an overview of Russia's progress in creating a modern company law, but. The full Report also addresses duties of directors for a company in financial distress, duties of a managing organization, the role of labor law in governing the relationship between a company and its directors and officials, whether this relationship is contractual or legal in nature, and differences between public and nonpublic companies.

Keywords
  • Russia,
  • company law,
  • liability of directors and officers
Disciplines
Publication Date
January 1, 2007
Citation Information
Bernard S. Black, Brian R Cheffins, Martin Gelter, Hwa-Jin Kim, et al.. "Report to Russian Center for Capital Market Development: Comparative Analysis on Legal Regulation of the Liability of Members of the Board of Directors and Executive Organs of Companies" U of Texas Law, Law and Econ Research Paper No. 110 (2007)
Available at: http://works.bepress.com/martin_gelter/2/