Genevieve is a member of the board of directors and the chief financial officer of the shoe fits. under the duty of due care that she owes the corporation, genevieve does not need to

Question

Raegan

Business

24 October, 05:10

Genevieve is a member of the board of directors and the chief financial officer of the shoe fits. under the duty of due care that she owes the corporation, genevieve does not need to

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Answers (1)

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Erin Howell · Answer 1

Oversee every aspect of the business.

Explanation:

The duty of due care refers to the reasonable and prudent care that a company's executive should exercise when making business decisions. This doesn't mean that managers should be punished if they make mistakes, since everyone makes mistakes.

Management cannot oversee everything that happens in a business, imagine if the CEO would have to work in the front desk, manufacture products, answer the phone, sell the merchandise, etc, etc.

What separates negligence from due care is that the decisions made must have been under reasonable and prudent circumstances.