Purpose: The purpose of this assignment is to explain the legal duties imposedon corporate directors and officers, to determine whether a director or officer has violated his or her legal duties to the corporation, and to evaluate how a violation of such duties may negatively affect the corporation and its shareholders.
Read the following scenario: Fitzgerald Foods is a food processing corporation. In the past year,three directors were forced to leave Fitzgerald Foods after it wasdiscovered the directors breached their legal duties to the corporation.Two of the directors were also officers of the corporation.
The chair of the Board of Directors at Fitzgerald Foods is concerned that the remaining directors do not understand their legal duties to the corporation and that new directors will not understand their duties either. You are the chief executive officer (CEO) of the corporation.
The chair of the Board of Directors asked you to work with the corporation's legal counsel to create a company policy document for directors and officers about their legal duties to the corporation.
1. Develop a 700- to 1,050-word company policy (template provided) for Fitzgerald Foods' directors and officers completing the following:
First Heading: Legal Duties of Directors and Officers (a heading from policy document)Explain the legal duties of directors and officers to the corporation, including the "business judgment rule."
Second Heading: Benefits of Compliance (a heading from policy document)Discuss the benefits of compliance for Fitzgerald Foods.
Third Heading: Consequences of Noncompliance (a heading from policy document)Analyze how unethical activity by a director or officer can lead to a violation of a legal duty owed to the corporation.
Provide a brief example from a news article or court case within the last three years that demonstrates corporate director or officer liability in the United States.
2. Use the Fitzgerald Foods Company Policy template as a guide for your policy document (under student materials).
3. Search the internet for examples of completed policy documents using the following search parameters: policy document example, policy document template, policy document format, policy document sample, or any variation you choose. An example may assist you to complete your policy document.
B. Create a separate 45-90 word interoffice memorandum (memo) using the Office Templates.Address memo to the chair of the Board of Directors.
Recommend at least two business risk management procedures that Fitzgerald Foods can adopt in the future to avoid violations of legal duties by its directors and officers.
C. Cite a minimum of two references preferably peer-reviewed. Do not cite to dictionaries, encyclopedias, or Wiki resources.