united-states corporate-law
Does the CEO of a company have any legal responsibility to act in the interests of its shareholders?
<p>Does US law include anything that places a burden of responsibility on a company's CEO to act in the interests of its shareholders, even if the CEO owns a majority share in the company?</p>
<p>Let's say, as extreme example, I'm the 51% owner &amp; CEO and the board representing 49% of the company's shareholders has an issue with me giving 100% of the company's assets away to charity - do they have any legal recourse?</p>
<p>I'm interested in any relevant US code or legal precedent.</p>

<h2>No, but ...</h2>
<p>The CEO is an officer of the company (as are the directors and any others with the ability to substantially exercise control over the company) and as such, owes <a href="https://uk.practicallaw.thomsonreuters.com/w-011-8693?transitionType=Default&amp;contextData=(sc.Default)&amp;firstPage=true#co_anchor_a133762" rel="nofollow noreferrer">fiduciary duties</a> to the <strong>company</strong> - not to the shareholders or any subset of them.</p>
<p>For example, if it is in the best interests of the company to enter a trading halt but not in the best interests of the current shareholders then the duty on an officer is to do what’s best for the company.</p>
<p>As another example, for a crime many limited by guarantee rather than by shares it’s rarely in the owner’s interest to have that guarantee called but it might be in the company’s interest.</p>

<p>It would be very unusual bylaws in the U.S. that provided for &quot;shareholders could demand that the issue be put up to a vote.&quot; Rather they can vote out board members and new board members can chose a new CEO.</p>
<p>Another recourse stockholders have is to sell their shares.</p>
