Question

Officers and directors of a corporation owe to the corporation the subordination of their self-interest to the interest of the corporation and owe constant loyalty to the corporation. This duty is the:

a. fiduciary duty.
b. duty of diligence
c. duty of indemnification
d. business judgment duty.

Answer 1

The duty described is the fiduciary duty, which requires officers and directors to prioritize the interests of the corporation and demonstrate loyalty.

Step-by-step explanation:

The duty described in the question is the fiduciary duty. This duty refers to the responsibility of officers and directors of a corporation to prioritize the interests of the corporation over their own self-interest. It also includes a constant loyalty to the corporation.

The fiduciary duty is based on the principle that those in positions of power within a corporation should act in the best interests of the shareholders, who are the true owners of the corporation.