Directors' Liabilities and the Business Judgment Rule in Korea

Abstract

Can we expect the corporate directors' fiduciary duties law and business judgment rule to develop in a civil law jurisdiction the laws of which are built upon sophisticated statutes full of mandatory rules and are interpreted by conservative judges? The answer may be a surprising yes as far as Korea is concerned. Although the current situation in Korea in respect of the corporate directors' fiduciary law is a hybrid of case law and statute, there is a trend toward refinement of relevant legal rules and principles along with the gradual recognition of the business judgment rule as it was developed in the United States. This article describes the recent high profile court cases in Korea in which the directors' liabilities and business judgment rule were discussed.