13.1-690 - General standards of conduct for director. - Virginia Statutes

§ 13.1-690. General standards of conduct for director.

A. A director shall discharge his duties as a director, including his dutiesas a member of a committee, in accordance with his good faith businessjudgment of the best interests of the corporation.

B. Unless he has knowledge or information concerning the matter in questionthat makes reliance unwarranted, a director is entitled to rely oninformation, opinions, reports or statements, including financial statementsand other financial data, if prepared or presented by:

1. One or more officers or employees of the corporation whom the directorbelieves, in good faith, to be reliable and competent in the matterspresented;

2. Legal counsel, public accountants, or other persons as to matters thedirector believes, in good faith, are within the person's professional orexpert competence; or

3. A committee of the board of directors of which he is not a member if thedirector believes, in good faith, that the committee merits confidence.

C. A director is not liable for any action taken as a director, or anyfailure to take any action, if he performed the duties of his office incompliance with this section.

D. A person alleging a violation of this section has the burden of provingthe violation.

(Code 1950, §§ 13-206, 13-207, 13.1-44; 1956, c. 428; 1985, c. 522.)