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Not just investors - but there are other stakeholders in the company.

The fiduciary duty of the management should be to try to ensure that the company meets its obligations to shareholders via profitability, to creditors, and to employees.

Fiduciary duty is breached by actions that are intended to risk the longer term financial health of the company for short term stock upticks.

by rootless2 on Wed Jun 24th, 2009 at 09:46:43 AM EST
[ Parent ]
the threat of prison might concentrate a few minds...

In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Wed Jun 24th, 2009 at 10:03:13 AM EST
[ Parent ]
I think this is really an argument for reducing dramatically the "limited" part of LLC. What is the case against the existence of LLCs (ie in favour of partnerships and other forms of company structures, which have a more balanced risk/reward)?



--
$E(X_t|F_s) = X_s,\quad t > s$

by martingale on Wed Jun 24th, 2009 at 09:19:40 PM EST
[ Parent ]

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