Reimagining CSR

For long it was considered that a company is collective of shareholders and, therefore, the best interest of shareholders is the best interest of the company

Topics
Corporate social responsibility | Indian companies | Indian Law

Asish K Bhattacharyya 

Asish K Bhattacharyya

Corporate law requires directors to take only those decisions that they honestly believe (in good faith) will serve the “best interest of the company as a whole”. For long it was considered that a company is collective of shareholders and, therefore, the best interest of shareholders is the best interest of the company.

However, in some jurisdictions, courts are taking the view that a company is a legal entity separate from shareholders and, therefore, the “best interest of the company as a whole” does not imply the best interest of shareholders. Directors must ...
First Published: Sun, July 19 2020. 17:17 IST