Business Judgment Rule

Business Judgment Rule

Learn about the business judgment rule, its requirements, and its underlying public policy rationale.


Welcome back to our tutorial on insider duties. Now that we’ve finished the clip on the duty of care, let’s turn to the business judgment rule.

In this clip, we’ll first define the business judgment rule. Next, we’ll explore the rationale underlying the rule. We’ll then turn to the specific requirements directors and officers must meet to claim the protection of the rule. Finally, we’ll look at a couple of examples of the business judgment rule in action. Let’s get started!

I. Business...