Duty of Loyalty of Directors in American Corporate Law:Concurrently on China's Corresponding Regulations

Directors of a corporation enjoy enormous power under the centralized management in America and cost of agency is bound to be entailed between shareholders and directors.As such,it is provided in law that directors assume fiduciary duty to the corporation and its shareholders,which mainly includes duty of care and duty of loyalty.Unfortunately,no satisfactory provisions concerning duty of loyalty of directors can be found in China's existing corporate law.The present author proposes that in China's corporate law,more obligators should be included to take up the duty of loyalty and contribution of burden of proof be specified.Further,matters such as where a director infringes the interests of the corporation,who will initiate the derivative action,and how and when to return the awarded interests to the corporation should also be expressly provided by law.