US Laws, Codes, Statutes & Cases

 
  § 717. Duty of directors and officers.
    (a)  Directors  and  officers  shall  discharge  the  duties  of their
  respective positions in good faith and with that  degree  of  diligence,
  care and skill which ordinarily prudent men would exercise under similar
  circumstances  in like positions. In the administration of the powers to
  make  and  retain  investments  pursuant  to  section  512   (Investment
  authority),   to   appropriate  appreciation  pursuant  to  section  513
  (Administration of  assets  received  for  specific  purposes),  and  to
  delegate  investment  management  of  institutional  funds  pursuant  to
  section 514 (Delegation of investment  management),  a  governing  board
  shall  consider  among  other relevant considerations the long and short
  term needs of the corporation in carrying out its purposes, its  present
  and  anticipated  financial  requirements,  expected total return on its
  investments, price level trends, and general economic conditions.
    (b) In discharging their duties, directors and officers,  when  acting
  in  good faith, may rely on information, opinions, reports or statements
  including financial statements and other financial data,  in  each  case
  prepared  or  presented by: (1) one or more officers or employees of the
  corporation, whom the director believes to be reliable and competent  in
  the  matters presented, (2) counsel, public accountants or other persons
  as to matters which the directors or officers believe to be within  such
  person's  professional  or  expert  competence or (3) a committee of the
  board upon which they do not serve, duly designated in accordance with a
  provision of the certificate of  incorporation  or  the  bylaws,  as  to
  matters  within  its designated authority, which committee the directors
  or officers believe to merit confidence, so long as in so  relying  they
  shall  be acting in good faith and with that degree of care specified in
  paragraph (a) of this section.  Persons shall not be  considered  to  be
  acting  in  good  faith  if they have knowledge concerning the matter in
  question that would cause such reliance to be unwarranted.  Persons  who
  so  perform  their  duties shall have no liability by reason of being or
  having been directors or officers of the corporation.