Frank Aquila, Melissa Sawyer and Ashlyann Harrison Look at Fiduciary Duties in the Zone of Insolvency for Bloomberg LawMay 18, 2020
Frank Aquila, S&C’s global head of M&A, Melissa Sawyer, co-head of S&C’s corporate governance practice and associate Ashlyann Harrison, authored an article for Bloomberg Law on the need for boards of directors to reexamine their fiduciary duties during the current pandemic. In particular, they offer guidance to directors of corporations in the “zone of insolvency,” which are those at risk of becoming insolvent.
The authors outline nine guiding principles that directors should consider at all times to ensure that they exercise their fiduciary duties, but particularly in response to the pandemic and in circumstances of financial instability. These include being informed of material business and legal developments, monitoring and evaluating the corporation’s finances and solvency, and considering the creation of a pandemic-response working group.
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