1. What is a Joint Stock Company?
2. Duties and Responsibilities of Board Members
3. Legal and Criminal Liability of Board Members
4. Effect of Tort and Fault on Board Members
5. Limits of Criminal Liability and Exceptions
6. Conclusion
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1. What is a Joint Stock Company?
A joint stock company is a form of commercial organization in which its capital is divided into shares and the liability of the partners is limited to their capital shares. Joint stock companies use management bodies when carrying out their commercial activities, and the most important among these bodies is the board of directors.
2. Duties and Responsibilities of Board Members
The board of directors is the administrative and operating body of the joint stock company. This board, which is responsible for the general operation of the company, is usually elected by the shareholders. The board of directors determines the company’s strategic direction, makes decisions and oversees operational processes. Therefore, board members are obliged to manage the company’s activities with honesty, loyalty and care.
3. Legal and Criminal Liability of Board Members
Board members are under legal and criminal liability while performing their duties. Legal liability generally arises from damages caused by board members’ negligence in their duties. These damages may be claimed by the company’s employees, shareholders or third parties.
4. Effect of Tort and Fault on Board Members
When board members commit tort due to their faulty behavior, they may cause losses to the company. For example, situations such as misusing company assets, gaining ill-gotten gains or committing fraudulent transactions may lead to legal and criminal liability of board members.
5. Limits of Criminal Liability and Exceptions
Criminal liability is usually based on willful or gross negligence of board members. However, in some cases, certain legal regulations or internal policies of the company may protect board members. For example, a board member who has acted lawfully can often be exempt from criminal liability.