Question

In: Operations Management

ou are required to post a minimum of one 200-word post in discussing this issue. 1-What...

ou are required to post a minimum of one 200-word post in discussing this issue.

1-What are the responsibilities/duties of the Board of Directors in acting to protect the shareholders of a publicly traded company?

2-Why do you think that Directors should have these duties?

3-Do you believe that shareholders should be allowed to file lawsuits against members of the board if they feel the board member has not done a good job in making the corporation profitable? Why or why not?

Solutions

Expert Solution

The board of directors must always act in the best interests of the company and its major stakeholders; the employees, the customers, the shareholders, the debt holders, and everyone else that is relying on the company to deliver on its promises. This is because they work for the company and the company is their responsibility. In publically trading company Every Board member is also a material shareholder. For a Board to do its job, it must represent all stakeholders' interests. The board of directors must Monitor relations with shareholders by gathering and evaluation of appropriate information and promote the goodwill and support of shareholders.

Shareholders can take legal action if they feel the directors are acting improperly. If the shareholders felt that the directors were trying to mislead them or to run the company for the directors' benefit. The shareholders might then take action .this is because shareholders also hold share and interest in the effective and profitable running of the company. This depends on the size of shareholding in the company.

keosha answered 7 months ago
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