What are the legal liabilities of corporate directors?

Corporate directors have a legal responsibility to make decisions in the best interest of their company and its stakeholders. This responsibility, known as the "duty of care," means that directors must exercise reasonable care and diligence in their decision-making. Directors must stay informed about the company, ask questions when necessary, and keep the company’s finances and operations in good order. They must also ensure compliance with the law and act in the company’s best interests when making decisions. In Washington, corporate directors can also be held legally liable for certain actions if they fail to meet their duty of care. This includes breach of fiduciary duty, which occurs when a director fails to fulfill their legal obligation to act in the best interest of the company and its shareholders. Directors can also be held liable for failing to properly oversee the company’s financial statements or accounting practices, resulting in the company’s misrepresentation of its financial information. In addition, corporate directors can be held liable for negligence if they fail to ensure that the company complies with applicable laws or regulations. Finally, directors can be held liable for fraud if their actions result in the company’s financial harms or losses. Therefore, corporate directors can be held personally liable for their actions, or for failing to take action, both civilly and criminally.

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What are the legal liabilities of corporate directors?

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